A sum of money becomes Rs. 13, 380 after 3 years and Rs. 20, 070after 6 years on compound interest. The sum (in Rupees) is:

• i) Let the sum of money be Rs. P and the rate of interest be r% per year and it supposed that the interest is compounded annually.
  
  ii) So amount after 3 years is given by P(1 + r/100)³ = 13380 ---- (1)
  Amount after 6 years = P(1 + r/100)⁶ = 20070 ------ (2)
  
  iii) So dividing (2) by (1):
  (1 + r/100)³ = 20070/13380 = 3/2
  Hence, P*(3/2) = 13380, substituting in equn. (1)
  Solving P = Rs. 8920
  Thus the amount = Rs. 8920
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