Question

A person deposited a sum of Rs. 6000 in a bank at 5% per annum simple interest. Another person deposited Rs. 5000 at 8% per annum compound interest. After two years the difference of their interest will be -

• A. Rs .230
• B. Rs .232
• C. Rs .832
• D. Rs .600

Answer 1

The correct option is B Rs .232

C.I. for 1 person $=\frac{6000\times 2\times 5}{100}$
$=Rs.600$
C.I. for II person $=5000[{(1+\frac{8}{100})}^2-1]$
$=5000\times [\frac{27}{25}\times \frac{27}{25}-1]$
$=5000\times \left[\frac{729-625}{625}\right]$
$=\frac{5000\times 104}{625}$
$\therefore Reqddifference=832-600$
$=Rs.232$