Arithmetic Ability
Compound Interest

111 / 134

Q.

The difference between the compound interest and the simple interest accrued on an amount of Rs. 18,000 in 2 years was Rs. 405. What was the rate of interest p.c.p.a. ?

View Answer

Correct choice: D

Explanation:

Let the rate be R% p.a. Then, [1800(1+R/100)2−1800]−(1800*R*2/100)=405 1800[(100+R)2/10000−1−2R/100]=405 1800[(100+R)2−10000−200R/10000]=405⇔ 9/5*R2=405 ⇔R2=(405*5/9)=225⇔R=15 Rate = 15%.
111 / 134