Question

The difference between simple and compound interests is Rs.120 for 2 years. If the principal is Rs.3000, find the rate of interest.

Answer 1

Answer:

20%

Step-by-step explanation:

Hi,

Let 'P' be the principle amount invested P = 3000

T = 2 years

Simple Interest = P*T*R/100

= 3000*2*R/100

Compound Interest = P[(1 + R/100)² - 1]

Given difference between Compound Interest and Simple Interest

= 3000[(1 + R/100)²-1 - 2R/100] = 120

⇒3000* R²/10000 = 120

⇒3R²/10 = 120

⇒R² = 400

R = 20

Hence, the rate of interest is 20%

Hope, it helps !

Answer 2

Answer:

Rate of Interest = 20%

Step-by-step explanation:

Principle = Rs 3000.

Time = 2 yrs.

Rate = x%.

SI = (P * r * t)/100 = (3000 * x * 2)/100 = 60x.

CI = P[$(1+0.01r)^{n}$ - 1] = 3000[(1.01x)²-1]

But in here we will use a trick or a short cut which says:

"If the difference between compound and simple interest is of two years than,

mod(CI - SI) = P(*R)²/(100)²

Where P = principal amount, R = rate of interest"

i.e. 120 = 3000(x)²/10000

or, x² = (120 * 10000)/3000 = 400.

or, x = 20.

∴Therefore, rate of interest is 20%.