Question
Find the difference between the compound interest earned on
Rs. 12,000 for 2 years at 10% p.a., compounded annually, and the simple interest earned on Rs. 9,000 for 4 years at 13% p.a.Solution
ATQ,
Compound interest received = 12000 × {1 + (10/100)}² − 12000
= 12000 × 1.10² − 12000
= 12000 × 1.21 − 12000
= Rs. 14,520 − 12,000 = Rs. 2,520
Simple interest received = 9000 × 4 × 13 ÷ 100= 9000 × 0.52 = Rs. 4,680
So, required difference = 4680 − 2520 = Rs. 2,160
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