Multiple choice

The interest on a certain sum at 4% p.a. is Rs. 400 in 2 years. Find the difference between the interest on the same amount for the same time period at 4% and 5% p.a, respectively.

  1. Rs. 50

  2. Rs. 100

  3. Rs. 150

  4. Rs. 90

  5. Rs. 200
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Simple interest for 2 years at 4% is 400, so the principal is 5000. The difference in interest for 2 years at 5% vs 4% is (5-4)% of 5000 for 2 years, which is 1% of 5000 * 2 = 100.

AI explanation

Using the simple interest formula, the principal is calculated as (100 times Interest) divided by (Rate times Time), which is (100 times 400) divided by (4 times 2), resulting in Rs. 5000. The difference in interest between the two rates for the same time period is simply (Principal times Difference in Rate times Time) divided by 100. Substituting the values gives (5000 times 1 times 2) divided by 100, which equals Rs. 100.

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