If a sum of money compounded annually becomes 1.44 times

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If a sum of money compounded annually becomes 1.44 times of itself in 2 years, then the rate of interest per annum is

1. 25%
2. 22%
3. 21%
4. 20%

Correct Option: D

Given in question , Time = 2 years , Rate = R%
Suppose Principal be P and Amount = 1.44P
Using the given formula ,

A = P		1 +	R		^T
			100

⇒ 1.44P = P		1 +	R		²
			100

⇒ (1.2)² =		1 +	R		²
			100

⇒ 1 +	R	= 1.2
	100

⇒ R = 0.2 × 100 = 20%
We can find required answer with the help of given formula :
Here, n = 1.44 , t = 2 years
R% = (n^{1 / t} − 1) × 100%
R% = [(1.44)^1/2 − 1] × 100%
R% = [(1.2) − 1] × 100%
R% = 0.2 × 100% = 20%