Question

Find the compound interest on rs 2000 for three years at 10% per annum compounded annually. Also find the difference between CI and SI for that period

Answer 1

Answer:

SI = Rs 600

CI = Rs 662

Difference = Rs 61

Step-by-step explanation:

Simple Interest = Principle * Rate of interest * time /100

Simple Interest for 3 Years = 2000 * 10 * 3 /100 =  Rs 600

Compound Interest = $P ( 1 + r/100n)^{nt}$ - P

Compound Interest = $2000 ( 1 + 10/100)^3$ - 2000

Compound Interest = $2000 ( 1 + 0.1)^3$ - 2000

Compound Interest = $2000 ( 1.1)^3$ - 2000

Compound Interest = 2000 * 1.331   - 2000

Compound Interest = 2000 (1.331   - 1)

Compound Interest = 2000 (0.331)

Compound Interest = 662

Difference between compound & Simple interest

= 662 -600

= 62 Rs

Answer 2

Answer:

SI = Rs 600

CI = Rs 662

Difference = Rs 61

Step-by-step explanation:

Simple Interest = Principle * Rate of interest * time /100

Simple Interest for 3 Years = 2000 * 10 * 3 /100 =  Rs 600

Compound Interest =  - P

Compound Interest =  - 2000

Compound Interest =  - 2000

Compound Interest =  - 2000

Compound Interest = 2000 * 1.331   - 2000

Compound Interest = 2000 (1.331   - 1)

Compound Interest = 2000 (0.331)

Compound Interest = 662

Difference between compound & Simple interest

= 662 -600

= 62 Rs