Multiple choice

The difference in simple interest and compound interest on a certain sum of money in $2$ years at $15 $% p.a. is Rs. $144$. The sum is

  1. Rs. $6,000$
  2. Rs. $6,200$
  3. Rs. $6,300$
  4. Rs. $6,400$
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D Correct answer
Explanation

Difference for 2 years = P * (r/100)^2. 144 = P * (15/100)^2 = P * (3/20)^2 = P * 9/400. P = 144 * 400 / 9 = 16 * 400 = 6400.

AI explanation

The formula for the difference between compound interest and simple interest for two years is P * (R/100)^2. Substituting the given values, we get 144 = P * (15/100)^2, which simplifies to 144 = P * 0.0225. Solving for P gives 144 / 0.0225, which results in a principal sum of Rs. 6,400.

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