QA – Placement Quizzes | Compound Interest | Question 15

The difference between compound interest and simple interest on an amount of Rs 15,000 for 2 years is Rs 96. What is the rate of interest per annum?
(A) 8
(B) 9
(C) 10
(D) None of these


Answer: (A)

Explanation: Simple Interest = 15000 * R/100 * 2
Compound Interest = 15000 * (1 + R/100)^2 – 15000
We have,
[ 15000 * (1 + R/100)^2 – 15000 ] – [15000 * R/100 * 2] = 96
15000 [ (1 + R/100)^2 – 1 – 2R/100 ] = 96
15000 [ 1 + R^2/10000 + 2R/100 – 1 – 2R/100 ] = 96
15000 [ R^2/10000 ] = 96
R^2 = 96 * 10000/15000 = 96 * 2/3 = 64
R = 8.

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