Question

The difference between simple interest and compound interest on a certain sum for 2 years at 5% is Rs.500.Find the sum.​

Answer 1

Answer:Let the sum be Rs.100

Computation of compound interest:

Prinicpal =Rs.100

R=10% per annum and n=2 years.

Amount=Rs.  

⎣

⎢

⎡

​  

100×(1+  

100

10

​  

)  

2

 

⎦

⎥

⎤

​  

 

               =Rs.  

⎣

⎢

⎡

​  

100×(  

2

11

​  

)  

2

 

⎦

⎥

⎤

​  

=Rs.121

Computation of simple interest:

Prinicpal =Rs.100

R=10% and Time =2 years.

∴S.I.=Rs.(  

100

100×10×2

​  

)=Rs.20

Thus, difference in C.I. and S.I.=Rs.(21−20)=Re.1

Now, if difference between C.I and S.I. is Re.1,    Then Sum =Rs.100

If difference between C.I. and S.I. is Rs.500,    Then Sum =Rs.(100×500)=Rs.50000

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