The compound interest on a certain sum at the end of two years is Rs.408. The simple interest on the same sum for the same time is Rs.400. The rate of interest per annum is:
Answer & explanation
Correct answer: option 1
Simple interest of 2 years = 400
Compound interest of 2 years = 408
Difference b/w CI and SI = 408 - 400 = 8
Simple interest of 1 year = \(\frac{400}{2}\) = 200
Rate of interest = \(\frac{8}{200}\) × 100%
= 4%