Question

The difference between simple interest and compound interest on a certain sum is Rs. 54.40 for 2 years at 8 percent per annum. Find the sum.

Answer 1

$S.Ifor2years=\frac{P\times r\times t}{100}=\frac{P\times 8\times 2}{100}=\frac{4\times P}{25}C.Ifor2years=P(1+\frac{r}{100}{)}^n-P=P\times (1+\frac{8}{100}{)}^2-P=P\times (1+\frac{2}{25}{)}^2-P=P\times (\frac{27}{25}{)}^2-P=\frac{729\times P}{625}-PC.I-S.I=54.4054.40=\frac{729\times P}{625}-P-\frac{4\times P}{25}54.40=\frac{729\times P-625\times P-4\times 25\times P}{625}625\times 54.40=P(729-625-100)625\times 54.40=P\times 4P=8,500$