Question 30

If the difference between compound interest and simple interest for a certain amount of money invested for 3 years at an annual interest rate of 10% is INR 527, then the amount invested in INR is

Let the amount invested be P.

Now, compound interest for 3 years = Amount after three years - Principal

or, C.I. = $$P\left(1+\dfrac{10}{100}\right)^3-P=P\left(1.1\right)^3-P=1.331P-P=0.331P$$

Also, simple interest for 3 years = S.I. = $$\dfrac{P\times\ 10\times\ 3}{100}=0.3P$$

Given, C.I. - S.I. =527

or, $$0.331P-0.3P=527$$

or, $$0.031P=527$$

or, $$P=\dfrac{527}{0.031}=17000$$

So, amount invested is 17000 INR.

Create a FREE account and get:

  • Download Maths Shortcuts PDF
  • Get 300+ previous papers with solutions PDF
  • 500+ Online Tests for Free