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a) At what percent rate of compound interest per annum will the compound interest on Rs 1,25,000 be Rs 91,000 in 3 years?​

Sagot :

The rate of compounding on the investment is 20%.

What is the rate of compounding?
When an amount compounds annually, it means that both the amount invested and the interest accrued increases in value once a year.

The formula that can be used to determine the rate of compounding is: (FV / PV)^(1 /n)

Where:

  • FV = future value = 125,000 + 91,000 = 216,000
  • PV = present value = 125000
  • n = number of years - 3

(216,000 / 125000)^ (1 / 3) - 1 = 20%

To learn more about future value, please check: https://brainly.com/question/18760477

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