Question

By using the formula, find the amount and compound interest on:

The difference between the compound interest and the simple interest on a certain sum for 3 years at 10% per annum is Rs 93. Find the sum.

Answer 1

Let sum (p) = Rs. 100
Rate (r) = 10% p.a.

Period (t) = 3 years
∴ Simple interest (S.I.)=(prt/100)=100×10×3/100=Rs. 30
When interest is compounded annually, then Amount (A)= P(1+r/100)ⁿ=Rs. 100(1+10/100)³=Rs. 100×(11/10)³=Rs. 100×11/10×11/10×11/10=Rs. 1331/10
∴ C.I = A- P = Rs. 133110−Rs. 100=Rs. 33110
Difference between C.I. and S.I.=Rs. 33110−Rs. 30=Rs. 3110
If difference is Rs. 3110, Then sum=Rs.100 and
if difference is Rs. 93 then sum=Rs.100×93×1031=Rs. 3000 Ans.