*If Rs. 500 amounts *to *Rs. 583.20 in *two years *compounded *annually, find the rate of *interest per *annum.

7%p.a

8%p.a

9%p.a

10%p.a

B. 8%p.a

Principal = Rs. 500; Amount = Rs. 583.20; Time = 2 years.

Let the rate be R% per annum..

'

Then, [ 500 (1+(R/100)^{2 }] = 583.20 or [ 1+ (R/100)]^{2 = }5832/5000 = 11664/10000

[ 1+ (R/100)]^{2 }= (108/100)^{2} or 1 + (R/100) = 108/100 or R = 8