Question
Download Solution PDFThe difference between compound interest and simple interest for 3 years at the rate of 20% per annum is ₹240. What is the principal lent?
Answer (Detailed Solution Below)
Detailed Solution
Download Solution PDFGiven:
The difference between compound interest and simple interest for 3 years at the rate of 20% per annum is ₹240.
Formula Used:
Difference between Compound Interest (CI) and Simple Interest (SI) for 3 years = P × (r/100)3 + 3P × (r/100)2
Calculation:
Let the principal amount be P.
Rate (r) = 20%
Time (t) = 3 years
Difference between CI and SI for 3 years = ₹240
⇒ P × (20/100)3 + 3P × (20/100)2 = 240
⇒ P × (0.2)3 + 3P × (0.2)2 = 240
⇒ P × 0.008 + 3P × 0.04 = 240
⇒ 0.008P + 0.12P = 240
⇒ 0.128P = 240
⇒ P = 240 / 0.128
⇒ P = 1875
The principal lent is ₹1,875.
Last updated on Jun 2, 2025
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