When difference between compound and simple interest for three years is ₹122 at 5% interest per annum, the principal is ₹______
Show answer & explanation
Correct answer: A
Explanation
The correct answer is option 1 i.e. 16000.
Difference between CI and SI for 3 years = P × (R2/1002) × (300+R)/100
Here, Difference = 122, R = 5
So,
122 = P × (25 / 10000) × (305 / 100)
122 = P × (25 × 305) / 1000000
122 = P × 7625 / 1000000
122 = P × 0.007625
P = 122 / 0.007625
P = 16000