Multiple choice

If the difference between the compound interest compounded annually and the simple interest on a certain sum of money for three years at 10% per annum is Rs. 279, then the sum (in Rs.) is:

  1. 9,000

  2. 10,000

  3. 8,000

  4. 7,500

  5. NA
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A Correct answer
Explanation

For 3 years at 10%, the difference between CI and SI is P * (r/100)^2 * (3 + r/100). 279 = P * (0.1)^2 * (3.1) = P * 0.01 * 3.1 = P * 0.031. P = 279 / 0.031 = 9000.

AI explanation

The difference between compound interest and simple interest for three years is given by the formula Principal multiplied by r squared multiplied by the quantity (300 plus r) divided by 100 cubed. Substituting the rate of 10 and the difference of 279, the equation is 279 equals Principal multiplied by 100 multiplied by 310 divided by 1000000. Solving this equation gives the principal sum as Rs. 9000.

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