Question
The compound interest on a certain some of money for 2 years at 10% per annum is Rs 420. The simple interest on the same sum at the same rate and for the same time will be ?
Answer: Option D
$$\eqalign{
& {\text{Rate = 10}}\% \cr
& {\text{Time = 2 years}} \cr
& {\text{Effective rate of CI for 2 years}} \cr
& {\text{ = 10 + 10 + }}\frac{{10 \times 10}}{{100}} \cr
& = 21\% \cr
& {\text{Effective rate of SI for 2 years}} \cr
& {\text{ = 2}} \times {\text{10 = 20}}\% \cr
& {\text{Required SI}} \cr
& {\text{ = }}\frac{{420}}{{21}} \times {\text{20 = Rs. 400}} \cr} $$
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$$\eqalign{
& {\text{Rate = 10}}\% \cr
& {\text{Time = 2 years}} \cr
& {\text{Effective rate of CI for 2 years}} \cr
& {\text{ = 10 + 10 + }}\frac{{10 \times 10}}{{100}} \cr
& = 21\% \cr
& {\text{Effective rate of SI for 2 years}} \cr
& {\text{ = 2}} \times {\text{10 = 20}}\% \cr
& {\text{Required SI}} \cr
& {\text{ = }}\frac{{420}}{{21}} \times {\text{20 = Rs. 400}} \cr} $$
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