In a scheme ₹ 200 was invested for one year, which provides 10% annu

1.	In a scheme ₹ 200 was invested for one year, which provides 10% annual simple interest. Another ₹ 200 invested for one year in an other scheme, which provides compound interest at 10% semi-annually. How much more will be the interest earned under the second plan?1. 50 paise2. No difference3. 25 paise4. ₹ 1
Answer» Correct Answer - Option 1 : 50 paise Given: ⇒ Principle = Rs.200 ⇒ Rate of interest = 10% ⇒ Time period = 1 year Formula: Let P = Principle, R = Rate of interest and N = time period ⇒ Simple interest = PNR/100 ⇒ Compound interest = P(1 + (R/2)/100)²ⁿ - P Calculation: ⇒ Simple Interest after a year = (200 × 10 × 1)/100 = Rs.20 ⇒ Compound interest after a year compounded semi annually = 200(1 + 5/100)² - 200 = Rs.20.5 ∴ Required difference between interests = 20.5 - 20 = Rs.0.5 = 50 paise.

In a scheme ₹ 200 was invested for one year, which provides 10% annual simple interest. Another ₹ 200 invested for one year in an other scheme, which provides compound interest at 10% semi-annually. How much more will be the interest earned under the second plan?1. 50 paise2. No difference3. 25 paise4. ₹ 1

Answer» Correct Answer - Option 1 : 50 paise

Given:

⇒ Principle = Rs.200

⇒ Rate of interest = 10%

⇒ Time period = 1 year

Formula:

Let P = Principle, R = Rate of interest and N = time period

⇒ Simple interest = PNR/100

⇒ Compound interest = P(1 + (R/2)/100)²ⁿ - P

Calculation:

⇒ Simple Interest after a year = (200 × 10 × 1)/100 = Rs.20

⇒ Compound interest after a year compounded semi annually = 200(1 + 5/100)² - 200

= Rs.20.5

∴ Required difference between interests = 20.5 - 20 = Rs.0.5 = 50 paise.

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