babita invested a sum of money for 2 years at 4% per annum simple
and earned Rs 480 as the interest. How much more amount
would she get if interest was compounded annually?
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Answer:
Babita would gave got Rs. 9.60 more more money if the interest was compounded annually.
Step-by-step explanation:
Sum of money ( principal)
= (S.I × 100)/( r × t)
= 480× 100/ 2 × 4
= Rs. 6000
Compound interest
= P(1+r/100)^n -P
= 6000( 1+ 4/100)^2 - 6000
= 6000× 104/ × 104/100 - 6000
= 6489.6 - 6000
= Rs. 489.60
Compound interest - Simple interest
= 489.60 - 480
= Rs. 9.60
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