Bissoy.com
Doctors Medicines MCQs Q&A

A man invests a certain sum of money at the rate of interest 10% for 2 years. After 2 years, he earns Rs. 400 as a simple interest. If he invests the same sum of money at the same rate for 2 years on compound interest, then find how much percentage of the compound interest is greater than the simple interest?

A man invests a certain sum of money at the rate of interest 10% for 2 years. After 2 years, he earns Rs. 400 as a simple interest. If he invests the same sum of money at the same rate for 2 years on compound interest, then find how much percentage of the compound interest is greater than the simple interest? Correct Answer 5%

Given:

Simple interest = Rs.400

Rate of interest =10%

Time = 2 years

Formula:

When calculated at simple interest

Interest = (p × r × t)/100

Where p, r and t respectively are principal, rate of interest and time

When calculate at compound interest

Amount (A) = p (1 + r/100)n

Where p, r and n respectively are principal, rate of interest and time

Interest = Amount – Principal

Calculation:

Let the principal be P

⇒ 400 = (P × 10 × 2)/100

⇒ P = 2000

Now, the same sum is invested at same rate for 2 years at compound interest 

Amount = 2000 × (1 + 10/100)2

⇒ Amount = 2000 × (11/10) × (11/10) = 2420

⇒ Compound interest = 2420 – 2000 = 420

⇒ Required Percentage = × 100 = (20/400) × 100 = 5%

∴ Compound interest is greater than Simple interest by 5%

Related Questions

The question below is followed by statements I, II, and III. You have to determine whether the data given in the statement is sufficient for answering the question. You should use the data and your knowledge of Mathematics to choose the best possible answer. The difference between the compound interest and simple interest on a certain sum at a certain rate of interest per annum for two years is 204.20. What is the amount received on the sum of compound interest at the same rate of interest at the end of three years. I. The difference between the compound interest and the simple interest on the sum for three years is 804.258. II. The sum becomes Rs. 14528 at the end of one year. III. The compound interest on the sum for two years is 7% more than the simple interest on the sum for two years.
Priya and khushi invested Rs.3000 together. Priya invested her amount at compound interest for ‘x/10’ years at x% rate interest and khushi invested half of her amount at compound interest and remaining half at simple interest at the same rate of interest for the same time period. [It is given that ‘x/10’ is a natural number] What is the value of ‘x’? Statement I: Ratio of investment of priya and khushi is 1 : 2 respectively and total sum received by them together after a particular time at x% rate of interest is Rs. 4280. Statement II: Simple interest received by khushi is Rs. 40 less than compound interest received by her. Statement III: Sum of simple interest and compound interest received by khushi after a certain time at x% rate of interest is Rs. 2500 Which of the above statement is redundant to find the answer of the given question?
Each of the question below consists of a question and three statements number I, II and III given below it. You have to decide whether the data provided in the statement are sufficient to answer the question. What is the rate of interest? I. Sum A becomes double in 4 years when invested at a certain rate interest per annum. (Consider simple interest) II. Mamta invests Rs. 5000 for t years and sajan invests Rs 3000 for T years at same rate of interest. Ratio of interest earned is 4 : 7. (Consider simple interest) III. Sum S becomes quadruple when invested in compound interest for 2 years at a certain rate of interest per annum.
P, Q, R, S, T, V and W are seven members of the family. There are three female members. Each of them has a difference profession-­Lawyer, Chartered Accountant (CA), Engineer, Teacher, Doctor, Architect and Pharmacist. No Lady is either a pharmacist or a chartered Accountant. Each of them has a different monthly income. The chartered accountant earns the most. S, the engineer, earns less than V, the doctor. R, the teacher, earns more than P and less than S. W’s wife earns the least. T is an unmarried lady Lawyer and she earns less than P and more than only Q. The pharmacist’s income is not the lowest Who earns the least?
J, K, L, M, N and O are six colleagues working in an NGO. J earns more than L but less than M. K earns more than J but less than N. N earns less than O but more than M. K earns less than M. Who among the six earns the most?
For a business, A invests Rs. 60,000. After six months, B joins and invests Rs. 72,000 and A invests Rs. 4,000 more. After another two months, C joins and invests Rs. 92,000 and A invests Rs. 2,000 more and B invests Rs. 6,000 more. After sixteen months, the profit earned was Rs. 1,89,000. What is the A’s and C’s share of profit?
There are five statements given below: i. karim earns more than Rahim but less than Raihan ii. Tarique earns more than Farid iii. Rahim earns more than Rariq iv. Raihan and Rarique earn equal amounts v. Farid earns the least amount which of the above statements prove that Tarique earns more money than Rafiq?
Given below are two quantities named A and B. Based on the given information, you have to determine the relation between the two quantities. You should use the given data and knowledge of Mathematics to choose between the possible answers. A and B started a business in a partnership firm in the year 2017 and decided to share profits in capital ratio. In the year 2017, they share profits equally. Quantity A∶ Number of months after which A made his 3rd investment if A invests Rs. 1000 at the beginning, Rs. 1500 after 3 months and after some time, he invests Rs. 2000, after 8 months, he invests Rs. 2500 Quantity B∶ Number of months after which B made his 3rd investment if B invests Rs. 1500 at beginning of every quarter and finally he invests Rs. 500 after 11 months
A sum is invested at compound interest. After the first and the second year, Rs. 435 and Rs. 580 interest is received. A man invests Rs. 550 at simple interest at 0.6 times the rate of interest at which the initial sum (at compound interest) was invested. How much simple interest will the man receive after 3 years?
Given below are three quantities named 1, 2 and 3. Based on the given information, you have to determine the relation among the three quantities. You should use the given data and knowledge of Mathematics to choose between the possible answer. The options represent the relations among three quantities. A. < B. > C. ≤ D. ≥ E. = Quantity 1: Sumit invested Rs. X for 2 years at the rate of R% per annum simple interest. The interest obtained is Rs. 450 less than the interest obtained when the same sum is invested for 2 years at the rate of (R + 9)% per annum simple interest. Find the value of X. Quantity 2: Ankit invested Rs. Y for 2 years at the rate of 10% per annum compounded annually. The interest obtained is 795 less than the compound interest received by him when he invested a sum of Rs. 3000 for 2 years at the rate of 20% per annum compounded annually. Find the value of Y. Quantity 3: Difference of CI and SI obtained on a sum of Rs. Z when invested for 2 years at 10% per annum is Rs. 20. Find the value of Z.