What is the difference (in Rs) between compound interest (compounded annually) and simple interest for 3 years on a principal of Rs 3000 at the annual rate of 20% ?

Principal sum = Rs. 3,000

Rate of interest = 20% and time period = 3 years

=> Difference between compound and simple interest = $$[P(1+\frac{R}{100})^T-P]-(\frac{P \times R\times T}{100})$$

= $$[3000(1+\frac{20}{100})^3-3000]-(\frac{3000 \times 20\times 3}{100})$$

= $$[3000(\frac{6}{5})^3-3000]-(1800)$$

= $$3000\times(\frac{216}{125})-4800$$

= $$(24\times216)-4800$$

= $$5184-4800=Rs.$$ $$384$$

=> Ans - (B)