Practicing Success

Target Exam

CUET

Subject

General Test

Chapter

Numerical Ability

Topic

Compound Interest

Question:

The difference between the compound interest on a sum of ₹ 8,000 for 1 year at the rate of 10% per annum, interest compounded yearly and half yearly is:

Options:

₹20

₹40

₹30

₹10

Correct Answer:

₹20

Explanation:

The formula used here is,

Difference in the simple interest and compound interest on a certain sum at R% per annum in 2 years = (CI - SI) = $\frac{PR^2}{100^2}$

⇒ Difference in the simple interest and compound interest on a certain sum at 10% per annum in 1 years compounded half yearly = x

So, actual rate = 5%

⇒ x = $\frac{8000 ×5^2}{100^2}$

⇒  x  =  \(\frac{8000}{400}\)

⇒  x   = 20

Thus, the sum is Rs 20