Multiple choice

The difference between the compound interest and the simple interest on a sum of money for three years at 10% per annum is Rs. 620. The sum is

  1. Rs. 40,000

  2. Rs. 12,000

  3. Rs. 10,000

  4. Rs. 20,000
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

For 3 years, the difference between CI and SI is P * (r/100)^2 * (3 + r/100). Given 620 = P * (0.1)^2 * (3.1) = P * 0.01 * 3.1 = P * 0.031. P = 620 / 0.031 = 20000.

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