Question
If the simple interest on a sum of money for 2 years at 5% per annum is Rs. 50, what is the compound interest on the same at the same rate and for the same time?
Answer: Option A
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Sum = Rs. \(\left(\frac{50\times100}{2\times5}\right)= Rs. 500. \)
Amount = Rs. \(\left[500\times\left(1+\frac{5}{100}\right)^{2}\right]\)
= Rs. \(\left(500\times\frac{21}{20}\times\frac{21}{20}\right)\)
= Rs. 551.25
So, C.I. = Rs. (551.25 - 500) = Rs. 51.25
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