A = Rs 170 future value t = 2 years r = 12.5% annual interest rate m = 1 number of compounding period per year n = 2 the number of compounding periods i = r/m = 12.5% interest per period P = the principal A = P(1 + i)^n P = A/(1 + i)^n P = 170/(1 + 0.125)^2 P = 170/1.265625 P = Rs 134.321
the sum that yield an amount of rs.170 after 2 years at 12.5% p.a. interest being compounded annually is Rs 134.321.
