The difference between the compound interest and the simple interest on an amount of Rs1 500 for 2 y...........

Quantitative Aptitude (MTS) Compound Interest

The difference between the compound interest and the simple interest on an amount of Rs1,500 for 2 years, at a given rate of

interest per annum, is Rs60. What is the rate of interest per annum, if in the case of compound interest, the interest is

compounded annually?

This questions was previously asked in

SSC MTS 22nd July 2022 Shift-1

20%

15%

25%

12.5%

- Simple Interest (SI) Calculation:

- Formula: SI = (Principal × Rate × Time) / 100

- For Rs 1,500 over 2 years, SI = (1500 × Rate × 2) / 100

- Compound Interest (CI) Calculation:

- Formula: CI = Principal × (1 + Rate/100)^Time - Principal

- For Rs 1,500 over 2 years, CI = 1500 × (1 + Rate/100)^2 - 1500

- Given Difference:

- CI - SI = Rs 60

- Substitute and Solve:

- (1500 × (1 + Rate/100)^2 - 1500) - ((1500 × Rate × 2) / 100) = 60

- Check options with trial and error:

- For 15%, 12.5%, and 25% calculations, the difference will not equal Rs 60.

- For 20%, the calculations correctly yield the difference as Rs 60.

- Correct Answer: Option 1: 20%

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