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Find the difference between the simple interest and the compound interest at 5% per annum for 2 years on principal of Rs. 2000.
Answer & Solution
Correct Answer:
Option
A
$$\eqalign{
& {\text{The}}\,{\text{difference}}\,{\text{between}}\,{\text{compound}}\,{\text{interest}}\,{\text{and}} \cr
& {\text{simple}}\,{\text{interest}}\,{\text{over}}\,{\text{two}}\,{\text{years}}\,{\text{is}}\,{\text{given}}\,{\text{by}} \cr
& \frac{{{{\Pr }^2}}}{{{{100}^2}}}\,or\,P{\left( {\frac{r}{{100}}} \right)^2} \cr
& {\text{Here,}}\,{\text{Principal}}\,\left( P \right) = Rs.\,2000 \cr
& {\text{Rate}}\,\left( r \right) = 5\% \cr
& {\text{Now}}\,{\text{difference}}, \cr
& D = \frac{{ {2000 \times 5 \times 5} }}{{ {100 \times 100} }} \cr
& D = Rs.\,5 \cr} $$
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Login2000*25/10000=5
ci-si=200*25/100*100
ci-si=5