Question

If the compound interest earned on a certain sum for 2 years at 12% per annum is Rs. 636, what will be the simple interest at the same rate for the same period?

• A. Rs. 400
• B. Rs. 750
• C. Rs. 800
• D. Rs. 600
• E. None of these

Answer 1

The correct option is D Rs. 600

Let the sum be Rs. x.

According to the data provided in the question, we can write the following:

$x\times 636=x{(1+\frac{12}{100})}^2$

x + 636= $\frac{784x}{625}$

⇒ 625x + 636 × 625 = 784x
⇒ 159x = 636 × 625
⇒ x = 2500
Required simple interest = 2500 × 0.12 × 2 = Rs. 600.