The difference between CI and SI on a sum for $2$ years at $6.25\%$ per annum is Rs $10$. The principal is:

Question

The difference between CI and SI on a sum for $2$ years at $6.25\%$ per annum is Rs $10$. The principal is:

Option A

Rs 2000

Option B

Rs 2200

Option C — Correct answer

Rs 2560

Correct choice.

Option D

Rs 2600

Explanation

Difference $=P\left(\frac{6.25}{100}\right)^2=P\times\left(\frac1{16}\right)^2=P\times\frac1{256}$. So $P=10\times256=2560$.

Chapter Mock 5: Simple Interest and Compound Interest