Question

The difference between simple interest and the compound interest on rs. 800 at 5% per annum for 1 year is,

Answer 1

Simple Interest = P*R*T /100
= 800*5*1 /100 = 40.
Now, Compound Interest
= P[(1+R/100)^T - 1]
800[(1+ 5/100) - 1]
= 800[1 +5/100 - 1]
= 800*5/100 = 40.

So, Difference = SI - CI = 40-40 = 0.

For one year, the compound interest and simple interest will be same. So, The difference will be zero.