Question

The compound interest on a sum of money for 2 years is 1331.20 and the simple interest on the same sum for the same period at the same rate is 1280. find the sum and the rate of interest per annum.

Answer 1

It is given that
CI for 2 years = 1331.20
SI for 2 years = 1280
So the difference = 1331.20 - 1280 = 51.20
Here 51.20 is the simple interest on 1280/2 = 640 for one year
We know that
Rate = $$(SI \times 100)/(P \times t)$$
Substituting the values
=$$(51.20 \times 100)/(640 \times 1)$$
Multiplying and dividing by 100
=$$(5120 \times 100)/(100 \times 640)$$
= 8% p.a.
So the SI for two more years at the rate of 8% p.a.
Sum =$$( SI \times 100)/(r \times t)$$
Substituting the values
=$$(1280 \times 100)/( 8 \times 2)$$
= $$8000$$