Multiple choice

Find the principal if the difference between the simple interest and the compound interest for $4$ years at $10\%$ annum be equal to Rs. $8$?

  1. $114.80$
  2. $124.80$
  3. $134.80$
  4. $144.80$
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Difference between CI and SI for 4 years at 10% is P * [ (1 + 0.1)^4 - 1 - (4 * 0.1) ]. 8 = P * [ 1.4641 - 1 - 0.4 ] = P * 0.0641. P = 8 / 0.0641 = 124.80.

AI explanation

For four years, the difference between compound interest and simple interest is calculated using the effective fraction formula Difference = P x (R/100)^2 x (4 + 6R/100 + (R/100)^2). Given the difference is 8 and the rate is 10 percent, the equation becomes 8 = P x (0.1)^2 x (4 + 0.6 + 0.01). Simplifying the multiplier gives 8 = P x 0.01 x 4.61, so 8 = 0.0461 x P. Solving for the principal gives P = 8 divided by 0.0461, which equals 124.80 rupees.

Keep practicing — related questions