The difference between compound interest and simple interest on an amount of Rs. 15,000 for 2 years is Rs. 96. What is the rate of interest per annum?
papay dey Answered question February 15, 2025
Let’s denote the rate of interest as R.
Simple Interest (SI) formula:
SI = (P × R × Time) / 100
Compound Interest (CI) formula:
CI = P × (1 + R/100)^Time – P
Given values:
P = Rs. 15,000
Time = 2 years
CI – SI = Rs. 96
For 2 years, the difference between CI and SI can be simplified as:
CI – SI = P × (R/100)^2
96 = 15000 × (R/100)^2
(R/100)^2 = 96 / 15000
(R/100)^2 = 0.0064
R/100 = √0.0064
R/100 = 0.08
R = 8
The rate of interest per annum is 8%.
papay dey Answered question February 15, 2025
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