If interest is compounded annually, what is the principal amount on which the compound interest for 3 years at an annual rate of 10% amounts to Rs 33?

Explanation

Let the principal be Rs x. The compound interest formula for 3 years at 10% per annum is: x × (1 + 0.10)^3 – x = 33. Simplifying, x × (1.331) – x = 33, which gives (1.331x – x) = 33 or 0.331x = 33. Solving for x, we get x = 33 / 0.331 = 1000. Therefore, the principal amount is Rs 1000.