Multiple choice

Direction : Study the following questions carefully and choose the right answer. If the compound interest on certain sum at 4% for 2 years is Rs. 2448. Find the simple interest on the same sum at the same rate for the same period.

  1. 2500

  2. 2400

  3. 2436

  4. 2420

  5. None of these
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

CI = P((1+r/100)^n - 1). 2448 = P((1.04)^2 - 1) = P(1.0816 - 1) = P(0.0816). P = 2448 / 0.0816 = 30000. SI = P * r * t / 100 = 30000 * 4 * 2 / 100 = 2400.

AI explanation

Using the compound interest to simple interest conversion formula for two years, the required simple interest equals the compound interest multiplied by 100 divided by 101 at a 4 percent rate. Substituting the given compound interest of Rs. 2448 gives 2448 multiplied by 100 and divided by 101, which results in a simple interest of Rs. 2400.

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