On a certain sum of money, after 2 years the simple interest and compound interest
obtained are Rs.400 and Rs.600 respectively. What is the sum of money invested?
(7 marks)
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sum of money = P
Rate = R
2 years
2 years simple interest = 400 = PR2/100
= PR/50 (I)
2 years compound interest = 600
=P(1+ R/100)^2 - P
= P( 1 + R^2/50 + R^2/10000) -P
= PR/50 +P R^2/10000
= PR(1/50. + R/10000) = 600. (II)
(II) / (I) = 600/400 =( PR/50 ) / (PR(1/50. + R/10000))
3/2 = (1/50. + R/10000) /50
3/2 = 1+R/200
1/2 = R/200
R = 100
PR/50 = 400
P= 20000/100 = 200
sum invested = 400
Rate of returns = 100%
hope helpful mark brainliast if you understood it.
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