If $ 500 amounts to $ 583.20 in two years compounded annually, find the rate of interest per annum.
Choose the correct choice from the following choices.
A) 6 B) 7 C) 8 D) 5 E) 4
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   Answer C.   So, rate = 8% p.a.
<result>C</result>
If $ 500 amounts to $ 583.20 in two years compounded annually, find the rate of interest per annum.