Simple interest on a sum for 3 years at 5% per annum is Rs. 1,200. What is the compound interest on the same sum for 2 years at the same rate?

Topic: Interest
Subtopic: SI and CI

ARs. 820

BRs. 840

CRs. 860

DRs. 880

Explanation

SI = P*R*T/100 => 1200 = P*5*3/100 => P = 8000. CI = 8000 * ((1.05)^2 – 1) = 8000 * 0.1025 = 820.

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