Multiple choice

The difference between SI and CI earned on a certain sum at the same annual rate of interest for the first 2 years is Rs. 84. If the total SI earned is Rs. 1680, find the rate of Interest the Principal.

  1. 5% & Rs.8000

  2. 5% & Rs.6000

  3. 10% & Rs.8400

  4. 10% & Rs.8000
Reveal answer Fill a bubble to check yourself
C Correct answer
AI explanation

The total simple interest for 2 years is Rs. 1680, so the simple interest for 1 year is Rs. 840. The formula for the difference between compound interest and simple interest for 2 years is (P times R squared) divided by 10000, which equals 84. From the simple interest equation, P times R divided by 100 equals 840, so substituting gives 840 times R divided by 100 equals 84, meaning the rate is 10%. Replacing R with 10 in the simple interest formula gives P times 10 divided by 100 equals 840, so the principal is Rs. 8400.

Keep practicing — related questions