The difference between the interest earned on the same amount invested under compound interest and simple interest at same rate of interest for 2 years is Rs.28. If the rate of interest is 4% p.a. then find the amount invested.(in Rs.)
Solution
Rate of interest = 4% and time period = 2 years
Let principal sum = Rs. $$P$$
Also, difference between compound interest and simple interest for 2 years = $$P(\frac{r}{100})^2$$
=> $$P(\frac{4}{100})^2=28$$
=> $$P=28\times\frac{10000}{16}$$
=> $$P=Rs.$$ $$17,500$$
=> Ans - (A)
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