Question:
Pritam bought a plot of land for Rs 640000. Its value is increasing by 5% of its previous value after every six months. What will be the value of the plot after 2 years?
Solution:
Given:
$\mathrm{P}=\operatorname{Rs} 64,000$
$\mathrm{R}=5 \%$ for every six months
Value of the plot after two years $=\mathrm{P}\left(1+\frac{\mathrm{R}}{100}\right)^{\mathrm{n}}$
$\Rightarrow 64,000\left(1+\frac{5}{200}\right)^{4}$
$=64,000(1.025)^{4}$
$=706,440.25$
Thus, the value of the plot after two years will be Rs $706,440.25$.