Question

Find the difference between compound interest and simple interest on 5000 for 2 years at 8% p.a payable annually?

• A. 45
• B. 32
• C. 57
• D. 84

Answer 1

Answer:

B. 32

$CI-SI=P(\frac{R}{100})^2for 2years$

$CI-SI=5000(\frac{8}{100})^2$

$=\frac{64}{2}$

$=32.$