The difference in compound interest, under annual compounding, and simple interest on a certain sum at the same rate of interest in 2 years is 144% of the sum. Find the rate of interest per annum.
Show answer & explanation
Correct answer: C
Explanation
The correct answer is option 3 i.e. 120%.
Difference (CI - SI) for 2 years = P(r/100)2
144% of P = P(r/100)2
144/100 = (r2/10000)
r2 = 14400
r = 120%