# A sum of money on compound interest amounts to Rs. 9680

Interests
A sum of money on compound interest amounts to Rs. 9680 in 2 yr and Rs. 10648 in 3 yr. What is the rate of interest per annum?

- 5%
- 10%
- 15%
- 20%

### Answer

Let the sum of money be P and rate of interest i.

Amount after n years = P(1 + i)^{n}

So, we have P(1 + i)^{2} = 9680 and P(1 + i)^{3} = 10648

Dividing the second equation by the first

1 + i = 10648 / 9680 = 1.1 = 1 + 0.1

i = 0.1 or 10%

**The correct option is B.**