Rs. x is invested at 14% simple interest and Rs. 2x at 7% compound interest per annum for 2 years. If the difference between the CI and SI is ₹392, what is the value of x?
Show answer & explanation
Correct answer: B
Explanation
Simple interest on ₹x at 14% (2 years) = x × 14 × 2/100
= 0.28x
Compound interest on ₹2x at 7% per annum (2 years) = 2x[(107/100)² − 1]
= 2x(1.1449 − 1)
= 0.2898x
0.2898x − 0.28x = 392
0.0098x = 392
x = 392/0.0098 = ₹40,000