Multiple choice

The difference between simple interest and compound interest at the same rate for Rs. 5000 for two years is Rs. 98. The rate of interest is

  1. 10%

  2. 14%

  3. 12%

  4. 15%
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. 98 = 5000 * (r/100)^2. 98/5000 = (r/100)^2. 0.0196 = (r/100)^2. Taking the square root, 0.14 = r/100, so r = 14%.

AI explanation

Using the formula for the difference between compound interest and simple interest for two years, which is D = P * R^2 / 10000, we substitute the given values: 98 = 5000 * R^2 / 10000. This simplifies to R^2 = 196, so R = 14. The rate of interest is 14%.

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