Multiple choice

A person invests the same amount of money at 10% per annum at simple interest and compound interest separately. After the completion of 3 years, he receives his payment and finds that there is a difference of Rs. 620 between the amounts. What is the amount of money he invested separately?

  1. Rs. 12000

  2. Rs. 18000

  3. Rs. 20000

  4. Rs. 25000

  5. Rs. 30000
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

CI - SI for 3 years = P * (r/100)^2 * (3 + r/100). 620 = P * (0.1)^2 * (3.1) = P * 0.01 * 3.1 = P * 0.031. P = 620 / 0.031 = 20000.

AI explanation

The difference between compound interest and simple interest for three years can be found using the formula principal multiplied by the rate squared multiplied by 3 plus the rate, divided by 100 cubed. Substituting the known values gives 620 equals principal multiplied by 10 squared multiplied by 3.1, divided by 1000000, meaning 620 equals 0.031 times the principal. Solving for the principal gives 620 divided by 0.031, which is 20000.

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