Multiple choice

The difference between the compound interest and the simple interest on a certain sum at 12% p.a. for two years is Rs. 90. What will be the value of the amount at the end of 3 years?

  1. Rs. 9000

  2. Rs. 6250

  3. Rs. 8530

  4. Rs. 8780.80
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

For a principal P at 12% for 2 years: the difference between CI and SI is P(1+0.12)² - P - (P×0.12×2) = P(1.2544 - 1 - 0.24) = P(0.0144) = 0.0144P. Given this difference is Rs. 90, we get P = 90/0.0144 = Rs. 6250. Amount after 3 years at CI: 6250(1.12)³ = 6250 × 1.404928 = Rs. 8780.80. Option D is correct. Options A, B, and C are incorrect calculations from wrong principals or formulas.

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