PRC-2 · Chapter 5 · Question 12 of 50
A manufacturing firm deposits Rs. 5,000 today into an account earning 10% compounded annually. They need the balance to grow to exactly Rs. 6,655. How many years will this take?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) 3 years
Explanation
Using the compound interest formula S = P(1 + i)^n: 6655 = 5000(1.10)^n. Dividing by 5000 gives 1.331 = 1.10^n. Because 1.10 cubed is exactly 1.331, n = 3 years.
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