Question

The difference between the compound interest and simple interest for 2 years at 10% pa, is
120. Find the principal. I want explanation ​

Answer 1

Answer:

Compound and simple interest questions are common in the exams. There are always 3-4 questions appearing from this topic. This topic is very vast and that is why we have decided to cover it in parts and today we are going to discuss the difference between simple interest and compound interest.Sometimes you are given a situation and you have the option of repaying more it through compound interest or through simple interest. Obviously, you will choose simple interest because it is a cheaper option. Also, in compound interest, you are asked to pay the principal amount by levying interest on interest. But you would still need to determine the difference between the compound and simple interest. If the difference asked is for either two or three years than you can easily solve it through the formulas. Here are the formulas to the calculated difference in interests.

Step-by-step explanation:

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Answer 2

Step-by-step explanation:

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