Question

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What is the difference between the simple interest and compound interest on rupees 40,000 for 3 years at 5% p.c.p.a ?
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By Choudhary21 ❤️​

Answer 1

$principal = \: rs \: 40000$

$time = 3 \: years$

$rate = 5\% \: p.a.$

$simple \: interest = p \times r \times t \div 100$

$40000 \times 5 \times 3 \div 100$

$rs \: 6000$

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Now to find Compound interest:-

Amount= P(1+R)÷100

40000(1+5)÷100

40000×11÷20×11÷20×11÷20

₹6655

Difference= Compound interest- Simple interest

6655-6000

₹655

So the difference between Compound interest and Simple interest is ₹655.

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Answer 2

Answer:

Learn more about Simple and Compound Interest in more detail here. If the difference between compound and simple interest is of three years than, Difference = 3 x P(R)²/(100)² + P (R/100)³.