Question

Find the compound interest at the rate of 10% per annum for 2 years on the principle which in 2 years at the rate of 10% per annum yields rupees 200 as simple interest

Answer 1

For simple interest:
t = 2years
r = 10%
I = 200
Let principal = P

we know $I = \frac{Ptr}{100}$ 

⇒$P= \frac{100*I}{t*r} = \frac{100*200}{2*10} =1000$

Compound interest:
r = 10%
t = 2years
P = 1000
n = 1

$A=P(1+ \frac{r}{n} ) ^{nt} =1000(1+0.1) ^{2} = 1000*1.21=1210$

Compound Interest = A - P = 1210 - 1000 = Rs. 210