Question
At a certain rate per annum, the simple interest on a sum of money for one year is Rs. 260 and the compound interest on the same sum for two years is Rs. 540.80. The rate of interest per annum is = ?
Answer: Option C
$$\eqalign{
& {\text{SI for 1 year}} \cr
& {\text{ = Rs 260}} \cr
& {\text{SI for 2 year}} \cr
& {\text{ = 260}} \times {\text{2}} \cr
& {\text{ = Rs}}{\text{. 520 }} \cr
& {\text{Difference in (CI}} - {\text{SI)}} \cr
& \left( {540.80 - 520} \right){\text{ = Rs 20}}{\text{.8}} \cr
& {\text{Required rate % }} \cr
& {\text{ = }}\frac{{20.8}}{{260}} \times {\text{100}} \cr
& {\text{ = 8% }} \cr} $$
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$$\eqalign{
& {\text{SI for 1 year}} \cr
& {\text{ = Rs 260}} \cr
& {\text{SI for 2 year}} \cr
& {\text{ = 260}} \times {\text{2}} \cr
& {\text{ = Rs}}{\text{. 520 }} \cr
& {\text{Difference in (CI}} - {\text{SI)}} \cr
& \left( {540.80 - 520} \right){\text{ = Rs 20}}{\text{.8}} \cr
& {\text{Required rate % }} \cr
& {\text{ = }}\frac{{20.8}}{{260}} \times {\text{100}} \cr
& {\text{ = 8% }} \cr} $$
Was this answer helpful ?
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