Mr Sharma wants to choose a investment plan
1. 15% for 5 years(SI)
2. 20% for 3 years(CI)
Which plan will result in higher amount?
My doubt is while doing the calculation for CI I got 1.728 then why are we subtracting it with 1 in order to find which will result in higher amount?
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If the question is asking that which will result in higher amount than what you are doing is correct. However, I suspect that the question might be that which plan will earn more interest. That is why you might have to subtract the original amount from the new amount to get the interest earned.
Hope that helps.