### Find the principal if the interest compounded at the rate of 10% per annum for two years is Rs. 420.

A. Rs. 1000 B. Rs. 2200 C. Rs. 2000 D. Rs. 1100 Answer: Option C
$\begin{array}{l}\text{Given,}\\ \text{Compound rate R = 10% per annuam}\\ \text{Time = 2 Years}\\ \text{CI – Rs.420}\\ \text{Let P be the required principal}\\ \text{ Amount, }\text{A}=\left\{\text{P}\times\left[1+\left(\frac{R}{100}\right)\right]^n\right\}\\ (\text{P}+\text{CI})=\left\{\text{P}\times\left[1+\frac{10}{100}\right]^2\right\}\\ (\text{P}+420)=\text{P}\times\left[\frac{11}{10}\right]^2\\ \text{P}-1.21\text{P}=-420\\ 0.21\text{P}=420\\ \text{ Hence, }\text{P}=\frac{420}{0.21}=\text{ Rs. }2000\end{array}$