Question

Find the principal if the difference between the simple interest and the compound interest for $4$ years at $10\%$ annum be equal to Rs. $8$?

• A. $114.80$
• B. $124.80$
• C. $134.80$
• D. $144.80$

Answer 1

Answer: (B)

$124.80$

Compound interest $=A-P$
$\text{C.I.}=P{(1+\frac{R}{100})}^n-P=P[{[1+\frac{10}{100}]}^4-1]$
$\text{C.I.}=0.4641P$
Simple interest, S.I. $=$ $\frac{\text{PNR}}{100}$
$\text{S.I.}=\frac{P\times 10\times 4}{100}$
S.I. $=0.4P$
Now .C.I $-$ S.I. $=8$
$\Rightarrow 0.4641P-0.4P=8$
$\Rightarrow P=\frac{8}{0.0641}$
$\Rightarrow P=$ Rs. $124.80$