The total difference between compound interest and simple interest on a certain sum of money for 2 years at two different rates of 14\(\frac{2}{7}\)% for 1st year and 11\(\frac{1}{9}\)% for 2nd year is Rs.40. The sum of money is:
Answer & explanation
Correct answer: option 4
14\(\frac{2}{7}\)% = \(\frac{1}{7}\)
11\(\frac{1}{9}\)% = \(\frac{1}{9}\)
Here, for 2 years difference:
⇒ \(\frac{Difference}{Principal}\) = \(\frac{1}{7}\) × \(\frac{1}{9}\) = \(\frac{1}{63}\)
ATQ,
⇒ 1R = 40
⇒ Principal = 63R = 63 × 40 = Rs.2520