Multiple choice

Find the difference between Simple interest and Compound interest on Rs. $30,000$ for $2$ years, at $10\%$ per annum.

  1. $100$
  2. $200$
  3. $300$
  4. $400$
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

SI = (30000 * 10 * 2) / 100 = 6000. CI = 30000 * (1 + 0.1)^2 - 30000 = 30000 * 1.21 - 30000 = 36300 - 30000 = 6300. Difference = 6300 - 6000 = 300.

AI explanation

Using the formula for the difference between compound interest and simple interest for two years, which is Principal times Rate squared divided by 10000, we substitute the values. The difference equals 30000 times 10 squared divided by 10000, simplifying to 30000 times 100 divided by 10000. This results in a difference of Rs. 300.

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