Question

The compound interest on a certain sum of money is $630 for 2 years at a rate of 10% per annum What is the corresponding simple interest?​

Answer 1

Answer:

It is given that

Period = 2 years

Rate = 10% p.a.

We know that

Sum = (SI×100)/(r×n)

Substituting the values

= (1600×100)/(10×2)

= 8000

Amount after 3 years =P(1+r/100) n

Substituting the values =8000(1+10/100) 3

By further calculation

=8000×11/10×11/10×11/10=10648

So the compound interest = A -P

Substituting the values

= 10648−8000

= 2648