Question

The C.I. on a sum of money for 2 years is Rs. 832 and the S.I. on the same sum for the same period is Rs. 800. The difference between the C.I and S.I. for 3 years will be

• A. Rs. 48
• B. Rs. 66.56
• C. Rs. 98.56
• D. None of these

Answer 1

The correct option is C Rs. 98.56

Given that simple interest for 2 years is Rs.800
i.e., Simple interest for 1st year is Rs.400 and simple interest for 2nd year is also Rs.400
Compound interest for 1st year will be 400 and compound interest for 2nd year will be $832-400=432$
We can see that compound interest for 2nd year is more than simple interest for 2nd year by $432-400=Rs.32$
Rs. 32 is the interest obtained for Rs.400 for 1 year
$R=\frac{100\times SI}{PT}=\frac{100\times 32}{400\times 1}=8$%
Difference between compound and simple interest for the 3rd year
= Simple Interest obtained for Rs.832 $=\frac{PRT}{100}=\frac{832\times 8\times 1}{100}=66.56$
Total difference between the compound and simple interest for 3 years $=32+66.56=Rs.98.56$