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      Question

      Calculate the difference between the simple interest and

      compound interest accrued on an amount of Rs. 1600 over a period of 2 years at an annual interest rate of 20%.
      A Rs. 56 Correct Answer Incorrect Answer
      B Rs. 64 Correct Answer Incorrect Answer
      C Rs. 72 Correct Answer Incorrect Answer
      D Rs. 48 Correct Answer Incorrect Answer
      E None of these Correct Answer Incorrect Answer

      Solution

      Desired difference = 1600 X [(1.2)Β 2Β - 1] - 1600 X 0.20 X 2 = 704 - 640 = Rs. 64 Hence, option b.

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