The difference between the simple interest and compound interest for 2 years is Rs 25 if rate of interest is 5 % p.a. Then find the sum?

• LET THE PRINCIPAL BE RS 100
  THEREFORE S.I= (100*5*2)/100 = RS 10
  COMPOUND INTEREST(C.I)= 100(1+ 5/100)^2 -100 = RS 10.25
  THEREFORE C.I - S.I = 10.25 -10 = 0.25
  IF DIFFERENCE IS RS O.25 ,THE PRINCIPAL = RS 100
  IF DIFFERENCE IS RS 25 ,THEN PRINCIPAL = 100* 25/0.25 = RS 10000 (ANS)
• 13 years agoHelpfull: Yes(36) No(4)
• It means in case of CI, 2nd year interest on interest of first year is Rs 25.
  Then interest of first year = 25*100/5 = Rs 500
  Hence principal sum = 500*100/5 = Rs 10000
• 13 years agoHelpfull: Yes(16) No(2)
• shortcut method:
  difference= sum(rate/100)^2
  25= sum(5/100)^2
  25= sum(1/400)
  so, sum= 10000(answer)
• 12 years agoHelpfull: Yes(13) No(3)
• Hello Dipin, will u plz explain a little more of yr sol of this problem??
  yrs solution is a nice short cut one.
  however, de CI of 2 yrs=P[1+5/100]^2 -P
  and the SI for 2 yrs=P*2*5/100, so subtractng both, and equating to 25 we get the principal as Rs 10000.
• 13 years agoHelpfull: Yes(6) No(3)