Examveda
Examveda

At a certain rate per annum, the simple interest on a sum of money for one year is Rs. 260 and the compound interest on the same sum for two years is Rs. 540.80. The rate of interest per annum is = ?

A. 4%

B. 6%

C. 8%

D. 10%

Answer: Option C

Solution(By Examveda Team)

$$\eqalign{ & {\text{SI for 1 year}} \cr & {\text{ = Rs 260}} \cr & {\text{SI for 2 year}} \cr & {\text{ = 260}} \times {\text{2}} \cr & {\text{ = Rs}}{\text{. 520 }} \cr & {\text{Difference in (CI}} - {\text{SI)}} \cr & \left( {540.80 - 520} \right){\text{ = Rs 20}}{\text{.8}} \cr & {\text{Required rate % }} \cr & {\text{ = }}\frac{{20.8}}{{260}} \times {\text{100}} \cr & {\text{ = 8% }} \cr} $$

This Question Belongs to Arithmetic Ability >> Compound Interest

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