The difference between the compound interest and simple interest accrued on a principal amount over 2 years at a rate of 15% per annum is Rs. 135. Find the principal sum.
Correct Answer :
Rs. 6,000
Solution :
The correct answer is Rs. 6,000.
Given Data:
Difference between Compound Interest (CI) and Simple Interest (SI) for 2 years = Rs. 135
Rate of interest () = 15% per annum
Time period () = 2 years
Formula:
The difference between Compound Interest and Simple Interest accrued on a principal amount over 2 years is given by:
where represents the principal sum and is the annual rate of interest.
Step-by-step Solution:
Substitute the given values into the formula:
Simplify the fraction to :
Square the fraction :
Rearrange the terms to solve for :
Divide 135 by 9:
Thus, the principal sum is Rs. 6,000.
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