What is the difference between
simple interest and compound
interest for 2 years at the rate of 5%
on Rs.1000?
Answers
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Step-by-step explanation:
Given ;
P = 1000
T = 2 years
R = 5 %
Let's find SI first;
SI = P × R × T / 100
SI = 1000 × 5 × 2 / 100
SI = 1000 × 10 / 100
SI = 10000 / 100
SI = 100
Let's find CI then ;
Given ;
P = 1000
T = 2 years
R = 5 %
A = P (1 + R / 100)^T
A = 1000 ( 1 + 5 / 100 ) ^ 2
A = 1000 ( 105 /100 ) ^ 2
A = 1000 × 105/100 × 105/100
A = 1102.5
CI = Amount - Principal
CI = 1102.5 - 1000
CI = 102.5
The difference between CI and SI
Difference = 102.5 - 100
Difference = 2.5
Hope it helps!!
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