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The Difference Between Simple Interest and Compound Interest at the Same Rate for Rupees 5,000 for Two Years is Rupees 98. the Rate of Interest Is:

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Question

Choose the most appropriate option.

The difference between simple interest and compound interest at the same rate for rupees 5,000 for two years is rupees 98. The rate of interest is:

Options

  • 12%

  • 14%

  • `10 1/2%`

  • 10%

MCQ
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Solution

14%

Explanation:

Here,

P = 5000

T = 2 years

Difference between S.I. and C.I. = 98

According to formulas

The difference for 2 years between S.I. and C.I.`="Pr"^2/(100)^2`

`98=(5000xx"r"^2)/(100)^2`

r2 = 196

∴ r = 14

∴ r = 14%

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Simple and Compound Interest (Entrance Exam)
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2016-2017 (May) Set 1
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