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Finding PrincipalCovid-19 has led the world to go through a phenomenal transition . E-learning is the future today. Stay Home , Stay Safe and keep learning!!! For finding principal we use the same formula of amount asA = P( 1 + r)n Where, P = principal R = rate in percent Examples : 1) What sum will become $9826 in 18 months if the rate of interest is 2 ½ % p.a. and the interest is compounded half-yearly ? Solution : Let the principal be $ P . R = 2 ½ % = 5/2 % = 2.5 % n = 18 months = 18/12 = 3/2 years Amount = A = $ 9826 As the interest is compounded half yearly then A = P ( 1 + r/2) 2n 9826 = P( 1 + 0.025/2) 2 x 3/2 9826 = P(1 + 0.0125) 3 9826 = P (1.0125) 3 9826 = P x 1.03797 P = 9826/1.03797 P = $ 9466.55 ________________________________________________________________________ 2) Find the principal, if the compound interest compounded annually at the rate of 10% p.a. for three years is $ 331. Solution : Let the principal be $ P. Compound interest = C.I= $ 331 Rate in percent = 10 n = 3 years C.I = A – P C.I = P( 1 + r) n - P 331 = P ( 1 + 0.10) 3 - P 331 = P ( 1.10) 3 - P 331 = P x 1.331 – P 331 = 0.331 x P P = 331/0.331 P = $ 1000 . __________________________________________________________________ 3) Find the sum which will earn $164 as compound interest at 5% per annum for 2 years compounded annually. Solution : Let the principal be $ P . R = 5 % n = 2 years CI = $ 164 As the interest is given CI = A - P 2n - P 164 = P ( 1 + 5%) 2n - P 164 = P [ (1 + 5%) 2n - 1] 164 = P [ (1 + 0.05) 2n -1] 164 = P[ (1.05) 2n -1] 164 = P[ 1.1025 -1] 164 = 0.1025 P P = 164/0.1025 P = $ 1600 Compound Interest ( CI ) • Find Compound Interest when interest is compounded Half yearly • Find Compound Interest when interest is compounded Quarterly • Find CI when interest is compounded annually but Rates are different • Finding Principal • Finding Time Period of Investment • Finding Rate of Interest Covid-19 has affected physical interactions between people. Don't let it affect your learning.
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