Question

7 Find the difference between the simple interest and compound interest on 2500 for
2 years at 4% per annum, compound interest being reckoned semi-annually.​

Answer 1

Answer:

Rs. 50

Step-by-step explanation:

Principal = Rs. 2500

Time = 2 years

Rate of Compound Interest per annum compounded semi-annually = 4%

Simple Interest on Rs. 2500 for 2 years at the rate of 4% per annum compounded semi-annually

= Rs. (2500×4×2)÷(100×2)

= Rs. 100

Compound Interest on Rs. 2500 for 2 years at the rate of 4% per annum compounded semi-annually = Rs. 2500 × (1 + 4÷2/100)^2×1/2 - 2500

= Rs. 2500 × (1 + 2/100) - 2500

= Rs. (2550 - 2500)

= Rs. 50

Difference between the Simple Interest and the Compound Interest on Rs 2500 for 2 years at the rate of 4% per annum as reckoned semi-annually = Rs. (100 - 50)

= Rs. 50