Compound Interest Practice Test 1

Question : 29 of 40

Marks: +1, -0

PRACTICE EXERCISE (LEVEL 2)

Tapan took a loan of Rs 1,600 from his friend at 5% p.a. simple interest. He lent it to Tushar at the same rate but compounded annually. Find his gain after 2 years.

Rs 14.10
Rs 16
Rs 4
Rs 5.67
Rs 15.9

Validate

Solution:

Tapan’s gain will be equal to the difference in SI and CI.
So,

\Sum=\Difference×(100/R)^2

1600={\Difference×100×100}/{5×5}

\Difference=16/4

Difference = Rs 4
So, Tapan will gain Rs 4.

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