Question

On a certain principal if the simple interest for two years is 2400 and compound interest for the two years is 2544 what is the interest rate

Answer 1

Answer:

12%

Step-by-step explanation:

SI=(P*R*T)/100

2400=(P*R*2)/100

120000=P*R                          

NOW WE USE CI AND SI DIFFERENCE  FORMULA

CI-SI=P(R/100)^2

2544-2400=P*R*R/10000          

144=120000*R/10000                          (as P*R=120000)

144=12*R

144/12=R

12=R

HENCE, INTEREST RATE =12%