Meera borrowed a sum of Rs 1000 from Sita for two years. If the rate of interest is 10% compounded annually, find the amount that Meera has to pay back

Explanation

Amount of loan `(P)=Rs.1000`
Rate `(R)=10%` p.a
Period `(n)=2` years
`∴A=P(1+R/100)^n`

`A=Rs.1000(1+10/100)^2`
`A=Rs.1000(11/10)^2`
`A=Rs.1000xx(11/10)xx(11/10)`
`A=Rs.1210`
`therefore` The amount to be paid by Meera is `Rs.1210`.