Aptitude - Compound Interest - Discussion

@Linka.

The shortcut method to find the Square root of 11236 is:

1*1=1,
2*2=4,
3*3=9,
4*4=16,
5*5=25, 6*6=36, 7*7=49, 8*8=64, 9*9=64, 10*10=100, 11*11=121, 12*12=144..

At first, see the last no i.e 6.
So 6 can be found either in 4 square or in 6 square.
Now, look at the first three numbers i.e. 112 which is near to square 10 as the square root of 11 will be more.

So 10*(10+1)=110.
Now see that 112<110.
So 6 square will be taken. Therefore square root of 11236 is 106.

1348.32-1200 = 148.32.

Now, 148.32/1200*100 = 148.32/12 which is greater than 12% but less than 13%.

So for 2 years of effective compound interests, annual interest must be greater than 6% but less than 6.5% (as 6.5% would lead effective interest to somewhere greater than 13%).

So, given options answer must be 6%.

Answer: 6%.

Let subtract sum from total amount 1348.32 - 1200 is 148.32.

148.32 is two years interest amt (profit) we get. Ten one year interest amount is 148.30/2 = 74 per annum.

Lets find the 74 amount interest rate of 1200 >>> 10% is 120 and then 6% is 74 Rs that all. 6% is right answer. Hope you understand this.

@Naresh it is divided by 12 since it is easy that way, also, it gives a perfect square of 106 & 100. One more important point you can divide both the numbers with any number, but we use specific numbers since they give a perfect square or else you can use any number to solve that problem.

@Mounika.

They didn't said 1348.32 is the compound interest they asked at what rate of the compound interest per annum the sum becomes 1348.32 from 1200 i.e 1348.32 can be equated to amount.

C.I = amount-sum.
Amount=sum(1+r/100)^t as the interest is compounded yearly.

Good luck.

Shakti borrows an amount of Rs 28000 for 2 years from a bank at a subsidised rate. At the end of 2 years he pays a sum of Rs 30870. How much was the rate of interest? What is the amount that should be paid if Shakti pays it after 3 years?

Solve it please?

The solution is 7, let me tell how check it out,
This is my own formulae.
A+B+AB/100 believe me it works,
take 7+7+7*7/100=14.49,

Total amount in % * 14.49= 12*14.49 =173.88 he asket for 2 years so 173.88*2 = 347.76 so got it so 7% is correct answer.

This method will take time because we need to think the square root that number. There is one formula for rate and i.e. 2 * ci - si * 100/si. But in this question how we'll able to find si?

Hai Shikhar,

1+R/100= 106/100.
100+R/100 = 106/100.
100+R= 106 ( 100 AND 100 CANCELLED EACH OTHER).
S0, R= 106-100.
i.e: 6.

I'm sure this would help you.

@Pinky.

You said that divide numerator and denominator by 12 we got 11236/10000.

My doubt is why we have to divide it by 12, please tell me the reason.