Question

The difference between simple interest and compound on $Rs.1200$ for one year at $10$% per annum reckoned half-yearly is:

• A. $Rs.2.50$
• B. $Rs.3$
• C. $Rs.3.75$
• D. $Rs.4$
• E. None of these

Answer 1

Answer: (B)

$Rs.3$

$S.I.=Rs.\left(\frac{1200\times 10\times 1}{100}\right)=Rs.120$.
$C.I.=Rs.[1200\times {(1+\frac{5}{100})}^2-1200]=Rs.123$.
$\therefore Difference=Rs.(123-120)=Rs.3$.