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If the difference between the compound and simple interest on a certain sum of money for 3 years at 5% per annum is ₹15.25, then find the sum.

Solution

✅ Correct Option: 1

For 3 years, difference =P[(1+r)3−1−3r]= P\left[(1+r)^3 - 1 - 3r\right] with r=0.05r = 0.05.

(1.05)3=1.157625(1.05)^3 = 1.157625, so the bracket is 1.157625−1.15=0.0076251.157625 - 1.15 = 0.007625.

Then P=15.250.007625=2000P = \frac{15.25}{0.007625} = 2000.

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