Question

If the difference between CI and SI for 2 years on ₹ 8000 is ₹ 180 then the rate of interest is ______.

Options

• 15%

• 5%

• 20%

• 10%

Answer 1

If the difference between CI and SI for 2 years on ₹ 8000 is ₹ 180 then the rate of interest is 15%.

Explanation:

Step 1: Shortcut formula for difference between CI and SI for 2 years:

For 2 years, the difference is:

`CI - SI = (P xx r^2)/100^2`

Where:

• P = 8000
• r = ? (rate of interest)
• CI – SI = 180

Step 2: Substitute the values:

`180 = (8000 xx r^2)/100^2`

`180 = (8000 xx r^2)/10000`

`180 = 0.8 xx r^2`

Step 3: Solve for r²:

`r^2 = 180/0.8`

= 225

`r = sqrt(225)`

r = 15%