Question

find the difference between the simple interest and compound interest on 625 at 4% interest for 2 years​

Answer 1

Given data in question are,

Principle amount (P)=$625$

Rate of Interest (R)=$4$%

Number of Year= $2 years$

We have to find the difference between the simple interest and compound interest,

$CI=P(1+\frac{R}{100} )^{2} -p=625(1+\frac{4}{100} )^{2}-625=625(\frac{104^{2} }{100^{2} }-1) =\frac{625\times816}{10,000} =Rs 51$

$SI= \frac{P \times T \times R}{100}=\frac{625 \times4\times2}{100}=Rs 50$

Difference between SI and CI =$Rs 51-Rs 50=Rs1$.

Therefore, difference between SI and CI is equal to $Rs 1.$