Multiple choice

The difference between the compound and simple interest on a certain sum for the first 2 years at the rate of 12% per annum each is Rs.81. What is the sum?

  1. Rs. 4000

  2. Rs. 5625

  3. Rs. 6575

  4. Rs. 8000
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B Correct answer
Explanation

Difference between CI and SI for 2 years = P * (r/100)^2. 81 = P * (12/100)^2 = P * (0.12)^2 = P * 0.0144. P = 81 / 0.0144 = 5625.

AI explanation

Using the formula for the difference between compound and simple interest for 2 years, the difference is (P times R squared) divided by 10000. Substituting the given values gives P times 12 squared divided by 10000 equals 81. Solving this gives P times 144 divided by 10000 equals 81, so P equals 810000 divided by 144, which is Rs. 5625.

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