Question

Find the difference between C.I. and S.I. on ₹ 7500 for 2 years at 10% per annum.

Answer 1

Given:

Principal (P) = ₹ 7500

Rate of interest (R) = 10% per annum

Time (T) = 2 years

Step-wise calculation:

1. Calculate Simple Interest (S.I.):

`S.I. = (P xx R xx T)/100`

= `(7500 xx 10 xx 2)/100`

= ₹ 1500

2. Calculate Compound Interest (C.I.) using the formula:

`A = P(1 + R/100)^T`

= `7500 xx (1 + 10/100)^2`

= 7500 × (1.1)²

= 7500 × 1.21

= ₹ 9075

C.I. = A – P

= 9075 – 7500

= ₹ 1575

3. Calculate the difference between compound interest and simple interest:

Difference = C.I. – S.I.

= 1575 – 1500

= ₹ 75