Problem: the compound interest on a sum for 2 years is rs . 832 and the simple interest on the same sum for the same period is rs . 800 . the difference between the compound and simple interest for 3 years will be
Rationale: explanation : given that simple interest for 2 years is rs . 800 i . e . , simple interest for 1 st year is rs . 400 and simple interest for 2 nd year is also rs . 400 compound interest for 1 st year will be 400 and compound interest for 2 nd year will be 832 - 400 = 432 you can see that compound interest for 2 nd year is more than simple interest for 2 nd year by 432 - 400 = rs . 32 i . e , rs . 32 is the interest obtained for rs . 400 for 1 year rate , r = 100 × si / pt = ( 100 × 32 ) / ( 400 × 1 ) = 8 % difference between compound and simple interest for the 3 rd year = simple interest obtained for rs . 832 = prt / 100 = ( 832 × 8 × 1 ) / 100 = rs . 66.56 total difference between the compound and simple interest for 3 years = 32 + 66.56 = rs . 98.56 answer : option b
annotated_formula: add(subtract(832, 800), multiply(832, divide(subtract(832, 800), divide(800, 2))))