Question

The difference between compound interest and simple interest on a certain

sum of money for two years at 5% per annum is 250, find the sum.​

Answer 1

Answer:

So, the Principal is Rs. 16,000/-

Explanation:

Let x be the Principal.

CI = P * (1 + R/100)^N - P where CI is Compound Interest, P is Pincipal, R is rate of Interest & N is No. of years.

And SI = PNR/100 where SI is Simple Interest & all other terms are same as above.

x * (1 + 5/100)^3 - x - x * 3 * 5/100 = 122

i.e. x * 1.05^3 - x - 0.15x = 122

i.e. 1.157625x - x - 0.15x = 122

i.e. 0.007625x = 122

i.e. x = 122/0.007625

i.e. x = 16000

So, the Principal is Rs. 16,000/-.