Multiple choice

The difference between CI and SI for 2 years at 10% rate of interest is Rs. 4. Find the sum of money.

  1. Rs. 400

  2. Rs. 200

  3. Rs. 300

  4. Rs. 800
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A Correct answer
Explanation

For 2 years, the difference between CI and SI is P * (r/100)^2. 4 = P * (10/100)^2 = P * 0.01. P = 4 / 0.01 = 400.

AI explanation

The formula for the difference between compound interest and simple interest for 2 years is Difference = Principal x (Rate / 100)^2. Substituting the known values gives 4 = Principal x (10 / 100)^2. Simplifying this, 4 = Principal x 0.01, which results in Principal = 400. The result is Rs. 400.

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