Multiple choice

The difference between the compound interest and simple interest on Rs. x at 7% per annum for 2 years is Rs. 24.50. What is the value of x?

  1. 5,400

  2. 4,800

  3. 5,000

  4. 6,000

  5. 7,200
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C Correct answer
Explanation

The difference between compound interest (CI) and simple interest (SI) for 2 years is given by the formula D = P * (r/100)^2. Plugging in the values, 24.50 = x * (7/100)^2, which simplifies to 24.50 = x * (49/10000). Solving for x gives x = (24.50 * 10000) / 49 = 5000.

AI explanation

For two years, the difference between compound interest and simple interest is given by the formula (Principal * Rate^2) / 10000. Substituting the given values, we get (x * 7 * 7) / 10000 = 24.50. This simplifies to 49x / 10000 = 24.50, so x = (24.50 * 10000) / 49. Solving this gives x = 5000. The value of x is 5000.

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