To find the year after which Mr. Rashid would recover his original investment, we need to calculate the future value of his remaining investment after 2 years at a 4% compound interest rate.
After 2 years, Mr. Rashid's investment would have lost 6% of its value per annum. We can calculate the remaining value of his investment after 2 years as follows:
Remaining Value = 60000 * (1 - (6/100))^2 = 60000 * (1 - 0.06)^2 = 60000 * (0.94)^2 = 60000 * 0.8836 = 53016.
Now, we need to find the number of years it takes for this remaining value of 53016 to grow to 60000 at a 4% compound interest rate.
Let's assume that it takes n years to reach 60000. The future value of the remaining investment after n years at a 4% compound interest rate can be calculated as follows:
Future Value = 53016 * (1 + (4/100))^n = 53016 * (1.04)^n.
We need to solve for n:
53016 * (1.04)^n = 60000.
Dividing both sides by 53016:
(1.04)^n = 60000 / 53016.
Taking the logarithm (base 1.04) of both sides:
n = log_base1.04(60000 / 53016).
Using a calculator, we find that n is approximately 2. According to the rounding rule, the value of n should be 2.
Therefore, Mr. Rashid would recover his original investment in the 2 + 2 = 4th year after investing at a 4% compound interest rate.
Mr Rashid invested rupees 60000 in a company but found that is investment was losing 6% of its value per annum after 2 years he decided to pull out what was left of the investment and place at 4% interest compound at twice the year he would recover his original investment in the ______ year after investing at 4%
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