Compound Interest Practice Test 1

Question : 11 of 40

Marks: +1, -0

The difference between the simple interest and compound interest at the same rate, for Rs 5,000 for 2 years is Rs 72. The rate of interest per cent per annum is:

Validate

Solution:

SI={5000×2×r}/100=100r

CI=5000(1+r/100)^2-5000

=5000(1+r^2/{100^2}+{2r}/100-1)

=5000(r^2/10000+r/50)

CI=r^2/2+100r

CI-SI=72

r^2/2+100r-100r=72

r=√144=12%

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