Difference between Compound Interest & Simple Interest.

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Presentation transcript:

Difference between Compound Interest & Simple Interest

When P is the Principal, n = 2 years and r is the Rate of interest, Difference between C. I. and S. I. for 2 years =

Example1:- Find the difference between Simple Interest and Compound Interest for a sum of Rs 8,000 lent at 10% p. a. in 2 years. Solution Given:- P = Rs 8000, n = 2 years, r = 10% p. a. To Find:- difference between Simple Interest and Compound Interest We know that difference between Simple Interest and Compound Interest when n is 2 years = 80 Ans:- Difference between Simple Interest and Compound Interest is Rs 80

Example1:- The difference between C. I. and S. I Example1:- The difference between C. I. and S. I. for 2 years on a sum of money lent at 5% p.a. is Rs 5. Find the sum of money lent. Solution Given:- difference between C. I. and S. I. =Rs 5 , n = 2 years, r = 5% p. a. To Find:- sum of money lent (Principal) We know that difference between Simple Interest and Compound Interest when n is 2 years = 5 X 10 X 10 = Rs 5000 Ans:- Difference between Simple Interest and Compound Interest is Rs 5000

Try these Find the difference between Simple Interest and Compound Interest for a sum of Rs. 50,000 lent at 25% p. a. in 2 years.