Question

The difference between simple interest and compound interest on a sum of 6000. What is the annual rate of interest?​

Answer 1

Answer:

Given Rate of interest is r = 10% = 0.1

Principal Amount is A = 6,000

Time is t=2 years

Interest is compounded yearly once ⟹n=1

Amount =P(1+ r/n)nt

=6000×(1+0.1) = 60000 ×(1 + 0.1 )²

=7260

Interest is A−P=7260−6000=1260

Simple Interest is

6000×10×2/100

=1200

Difference between simple interest and

compound interest is 1260−1200=60

Hence answer is = 60