If at same rate of interest, in 2 years, the simple interest is ₹44 and compound interest is ₹46, then what is the principal (in ₹)?
Show answer & explanation
Correct answer: D
Explanation
The correct answer is option 4 i.e. 242.
Difference between CI and SI for 2 years = (P × R²) / 100²
CI - SI = ₹2
So, (P × R²) / 10000 = 2 → P × R² = 20000 — (1)
Also, SI = (P × R × 2) / 100 = 44
So, (P × R) = 2200 — (2)
From (1) and (2):
R = 2200 / P → substitute into (1):
P × (2200 / P)² = 20000
(2200²) / P = 20000
P = (2200²) / 20000 = 4840000 / 20000 = ₹242