Question

Govind borrowed rs.8000 at 5% for 2 years on simple interest and he invested the same compunded annually. Calculate the difference between SI and compound interest.​

Answer 1

•Given

Principal= rs.8000

Rate of interest =5%

Time= 2years

❥Simple interest= (P×R×T)/100

➡(8000×5×2)/100

➡rs.800

Amount=P+I

➡ 8000+800=rs.8800

❥Compound interest

• For 1st year:

➡ (P×R×T)/100

➡ (8000×5×1)/100

➡ rs.400

Amount=P+I

➡ 8000+400=8400

• For 2nd year:

➡ (P×R×T)/100

➡ (8400×5×2)/100

➡ rs.840

Amount=P+I

➡ 8400+840=rs.9240

✭ Difference between SI and CI;

➡9240-8800=rs.440

❥So the difference of SI and CI on rs.8000 at 5% for 2 years is rs.440.

❥Hope it helps you...

Answer 2

Answer:

• REQUIRED ANSWER :)

Given :

Principal = Rs. 8000

Rate of interest = 5%

Time = 2 years

• Formula of Simple Interest :

$\ratio \implies \: \frac{p \times t \times r}{100}$

• Finding the simple interest :

$\ratio \implies \frac{8000 \times 5 \times 2}{100} = 800$

Total Amount :

Principal + Interest

= 8000 + 800

= Rs. 8800

• Finding the compound interest :)

For first year :

$: \implies \frac{p \times t \times r}{100} \\ \\ : \implies \frac{8000 \times 5 \times 1}{100 } = 400$

Total Amount :

Principal + Interest

= 8000 + 400

= Rs. 8400

For second year :

$: \implies \frac{p \times t \times r}{100} \\ \\ : \implies \frac{8400 \times 5 \times 2}{100} = 840$

Total Amount :

Principal + Interest

= 8400 + 840

= Rs. 9240

• Difference between SI and Compound Interest :

9240 - 8800 = Rs. 440

• Therefore :

The difference between SI and compound interest on Rs. 8000 at 5% for 2 years is Rs. 440