Multiple choice

If the difference between the compound and simple interests on a certain sum of money for 3 years at 5% per annum is Rs. 15.25, then the sum is -

  1. Rs. 1600

  2. Rs. 2400

  3. Rs. 1820

  4. Rs. 2000
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Difference between CI and SI for 3 years at 5% is P[(1.05)³ - 1 - 0.15] = P[1.1576 - 1.15] = P(0.0076). Given difference is Rs. 15.25, so P = 15.25/0.0076 ≈ Rs. 2000. The formula for difference is: CI - SI = P[(1 + r/100)³ - 1 - 3r/100].

Keep practicing — related questions