Multiple choice

The difference between CI (Compound Interest) and SI (Simple Interest) on a sum of Rs. 4,000 for 2 years at 5% p.a. payable yearly is

  1. Rs. 20

  2. Rs. 10

  3. Rs. 50

  4. Rs. 60
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

For 2 years, the difference between CI and SI is P * (r/100)^2. Difference = 4000 * (5/100)^2 = 4000 * (1/20)^2 = 4000 * (1/400) = 10.

AI explanation

The difference between compound interest and simple interest for two years is given by P times R squared divided by 10000. Substituting the values, the difference is 4000 times 5 squared divided by 10000, which equals 4000 times 25 divided by 10000. This simplifies to Rs. 10.

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