Theory question 101
Fractions, Decimals and Approximation(a) Without using Mathematical tables or calculators, evaluate: (0.09 × 1.21)/(3.3 × 0.00025), leaving the answer in standard form (Scientific Notation)
(b) A principal of GH¢5,600 was deposited for 3 years at compound interest. If the interest earned was GH¢1,200.00, find, correct to 3 significant figures, the interest rate per annum.
Show the model answer
Model answer
(a) = (9 × 10⁻² × 1.21)/(3.3 × 2.5 × 10⁻⁴) = (10.89/8.25) × 10² = 1.32 × 10²
(b) Amount = 5600 + 1200 = GH¢6,800
5600(1 + r/100)³ = 6800 → (1 + r/100)³ = 1.2143
1 + r/100 = 1.0669 → r ≈ 6.69% per annum
Explanation
In (b) use the compound interest formula, not simple interest.