Question
The difference between simple interest and compound on Rs. 1200 for one year at 10% per annum reckoned half-yearly is:
Answer: Option B
$$\eqalign{
& {\text{S}}{\text{.I}}{\text{.}}\, = Rs.\,\left( {\frac{{1200 \times 5 \times 2}}{{100}}} \right) \cr
& \,\,\,\,\,\,\,\,\,\,\,\,\, = Rs.\,120 \cr
& {\text{C}}{\text{.I}}{\text{.}} = Rs.\,\left[ {1200 \times {{\left( {1 + \frac{5}{{100}}} \right)}^2} - 1200} \right] \cr
& \,\,\,\,\,\,\,\,\,\,\,\,\, = Rs.\,123 \cr
& \therefore {\text{Difference}} = Rs.\,\left( {123 - 120} \right) \cr
& \,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\, = Rs.\,3 \cr} $$
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$$\eqalign{
& {\text{S}}{\text{.I}}{\text{.}}\, = Rs.\,\left( {\frac{{1200 \times 5 \times 2}}{{100}}} \right) \cr
& \,\,\,\,\,\,\,\,\,\,\,\,\, = Rs.\,120 \cr
& {\text{C}}{\text{.I}}{\text{.}} = Rs.\,\left[ {1200 \times {{\left( {1 + \frac{5}{{100}}} \right)}^2} - 1200} \right] \cr
& \,\,\,\,\,\,\,\,\,\,\,\,\, = Rs.\,123 \cr
& \therefore {\text{Difference}} = Rs.\,\left( {123 - 120} \right) \cr
& \,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\, = Rs.\,3 \cr} $$
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