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
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
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