The difference between CI and SI on Rs $10000$ for $2$ years is Rs $64$. The annual rate is:

Question

The difference between CI and SI on Rs $10000$ for $2$ years is Rs $64$. The annual rate is:

Option A

4%

Option B

6%

Option C — Correct answer

8%

Correct choice.

Option D

10%

Explanation

For 2 years, difference $=P\left(\frac{r}{100}\right)^2$. So $64=10000\left(\frac{r}{100}\right)^2$, giving $r^2=64$ and $r=8\%$.

Chapter Mock 5: Simple Interest and Compound Interest