Compound Interest Quiz Set 020

We have x × $(1 + 6/100)^3$ = (1030 - x) × $(1 + 6/100)^4$. Cancelling, we get x = (1030 - x) × (1 + 6/100). Simplifying, x = ${1030 × (100 + 6)}/(200 + 6)$, which gives x = Rs. 530.

The shortcut formula for the difference between compound and simple interest over a period of 2 years is $Difference = Principal × (\text"rate"/100)^2$, which equals $(30000 × 5^2)/10000$ = Rs. 75.

The shortcut formula for the difference between compound and simple interest over a period of 2 years is $Difference = Principal × (\text"rate"/100)^2$, which equals $(20000 × 8^2)/10000$ = Rs. 128.

If d is the difference, r is the rate and P is the principal, then the shortcut formula for the difference between compound and simple interest over a period of 2 years is d = P × $(r/100)^2$. So rate = 100 × $√{d/P}$ = 100 × $√{8/20000}$ = 2%.

In this case r = $24/4$% and n = 2 because compounding is quarterly. So A = 20000 × $(1 + 6/100)^2$, which equals 2 × 106 × 106, i.e., Rs. 22472.