When difference between compound and simple interest for three years is ₹152 at 4% interest per annum, the principal is ₹______
Show answer & explanation
Correct answer: C
Explanation
The correct answer is option 3 i.e. 31250 .
Let principal = P
Rate = 4%
Time = 3 years
SI for 3 years = P × 3 × 4/100 = 0.12P
CI for 3 years = P[(1 + 4/100)3 − 1]
= P[(1.04)3 − 1]
= P[1.124864 − 1]
= 0.124864P
Difference = CI − SI = 0.124864P − 0.12P = 0.004864P
Given difference = ₹152, so 0.004864P = 152
P = 152 ÷ 0.004864 = ₹31,250