The difference between simple interest and compound interest of a certain sum of money at 20% per annum for 1 year is Rs.200. Then the sum is: (Interest being compound half yearly)
Answer & explanation
Correct answer: option 1
Simple interest ⇒ 20%
Compounded interest ⇒ 10% + 10% + \(\frac{10 × 10}{100}\)% ⇒ 21%
Diff. b/w C.I & S.I. for two years ⇒ (21% - 20)% ⇒ 1%
ATQ,
1% of P = 200
100% of P = \(\frac{200}{1}\) × 100
Principal = Rs.20000