Question

A diffference of simple interest and compound interest of 3 years in 1600 and rs 222 at same rate. Find the rate of interest

Answer 1

Answer:

eg:

Let the sum =P

Simple Interest for three years =P×

100

5

×10=0.15P

CI=P(1+

100

5

)

3

−P

=P(1.05)

3

−P

1.15763P−P=0.15763P

Difference between compound interest and simple interest

CI−SI=0.51763P−0.15P

=0.00763P

0.00763P=76.30

P=10,000.

Answer 2

Answer:

Let the sum =P

Simple Interest for three years =P×1005×10=0.15P

CI=P(1+1005)3−P

=P(1.05)3−P

1.15763P−P=0.15763P

Difference between compound interest and simple interest

CI−SI=0.51763P−0.15P

=0.00763P

0.00763P=76.30

P=10,000.