Question

The difference between SI and CI on Rs 6600 for 1 yr at the rate of 24% p.a compounded annually would be *​

Answer 1

SI =

100

P×R×T

SI =

100

2400×2×5

=240

Compound interest:

Interest for first year =

100

2400×5×1

=120

Amount after first year =2400+120=2520

Interest for second year =

100

2520×5×1

=126

Amount after first year =2520+126=2646

Hence compound interest =2646−2400=246

Difference between CI and SI =246−240=6

Answer 2

Answer:

SI  =P×R×T/100

SI  =2400×2×5/100 =240

Compound interest:

Interest for first year   = 2400×5×1/100 =120

Amount after first year  =2400+120=2520

Interest for second year   = 2520×5×1/100 =126

Amount after first year  =2520+126=2646

Hence compound interest  =2646−2400=246

Difference between CI and SI =246−240= 6

Hence, the difference is 6.

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