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    Question

    The difference between compound interest and simple

    interest on a sum of Rs. 20,000 for 2 years at the same rate is Rs. 200. What is the annual rate of interest?
    A 15% Correct Answer Incorrect Answer
    B 10% Correct Answer Incorrect Answer
    C 20% Correct Answer Incorrect Answer
    D 25% Correct Answer Incorrect Answer

    Solution

    ATQ, For 2 years, Difference (CI − SI) = P × (r² / 100²), where r is rate %. Given: 200 = 20,000 × r² / 10,000 => 200 = 2 r² => r² = 100 => r = 10%

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