Multiple choice

What is the difference between the simple interest and the compound interest on a certain sum of money for 2 years at 15% per annum, if the simple interest on the sum at 10% per annum for a period of 2 years be Rs. 75?

  1. Rs. 7.3

  2. Rs. 6.7

  3. Rs. 8.4

  4. None of these
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Simple interest on sum P at 10% for 2 years = 75 => P * 0.1 * 2 = 75 => P = 375. CI for 2 years at 15% = P * ((1.15)^2 - 1) = 375 * (1.3225 - 1) = 375 * 0.3225 = 120.9375. SI for 2 years at 15% = 375 * 0.15 * 2 = 112.5. Difference = 120.9375 - 112.5 = 8.4375.

AI explanation

The principal sum is found using the simple interest formula: 75 = (P * 10 * 2) / 100, which yields P = 375. The difference between compound interest and simple interest for two years is calculated as Difference = P * R^2 / 100^2. Substituting the values gives 375 * 15^2 / 10000 = 8.4375. The result is approximately Rs. 8.4.

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