A sum of money deposited at 2% per annum compounded annually becomes Rs 10404 at the end of 2 years.

Question:

A sum of money deposited at 2% per annum compounded annually becomes Rs 10404 at the end of 2 years. Find the sum deposited.

Solution:

$\mathrm{A}=\mathrm{P}\left(1+\frac{\mathrm{R}}{100}\right)^{\mathrm{n}}$

$10,404=\mathrm{P}\left(1+\frac{2}{100}\right)^{2}$

$10,404=\mathrm{P}(1.02)^{2}$

$\mathrm{P}=\frac{10,404}{1.0404}$

$\mathrm{P}=10,000$

Thus, the required sum is Rs 10,000 .

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