Question

Rajan borrowed ₹5000at 8% p.a for 3years .find the difference between the compound interest and the simple interest,assuming annual compounding.

Answer 1

Answer:

For S.I.

sum=5000 , rate% = 8%p.a , time=3 yrs

S.I.= P×R×T/100

= 5000 × 8 × 3 / 100

= 1200

For C.I

sum=5000 , rate% = 8%p.a , time= 3yrs compounded annually.

Amount=P(1+R/100)^T

= 5000( 1+8/100)^3

=6298.56

C.I.=Amount-sum

=6298.56 - 5000

=1298.56

thus,

difference= 1298.56 - 1200

=98.56 (Ans)