If the compound interest on a certain sum for 2 years at 10% per annum is Rs. 1050, the sum is
Compound interest, CI = Rs.1050
Interest rate, R = 10% per annum
Time = 2 years
∴ CI = P (1 + R/100)n – P
⇒ 1050 = P (1 + 10/100)2 – P
⇒ 1050 = P (1 + 1/10)2 – P
⇒ 1050 = P (11/10)2 – P
⇒ 1050 = 121P/100 – P
⇒ 1050 = (121P – 100P)/100
⇒ 1050 = 21P/100
⇒ P = 1050 × 100/21
⇒ P = 50 × 100
⇒ P = 5000
∴ Sum = Rs.5000