The simple interest on a certain sum of money for 4 years at 16% per annum is 2/5th of the compound interest on Rs. 6000 for 2 years at 20% per annum. The sum placed on simple interest is:
CI = [6000 × (1 + 20/100)2 – 6000] = 6000 × (6/5) × (6/5) – 6000 = Rs 2640. Now SI = 1056 (i.e. 2640 × (2/5)) Therefore, (P × 4 × 16)/100 =1056 So P = Rs 1650.
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