Mathematics for FinancePYQ Nov 18Question 1410 of 512
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If the difference between the compound interest compounded annually and simple interest on a certain amount at 10%\displaystyle 10\% per annum for two years is Rs. 372\displaystyle \text{Rs. }372, then the principal amount is

Options

ARs. 37,200\displaystyle \text{Rs. }37,200
BRs. 37,000\displaystyle \text{Rs. }37,000
CRs. 37,500\displaystyle \text{Rs. }37,500
DNone of these
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Correct Answer

✅ Option a — Rs. 37,200\displaystyle \text{Rs. }37,200

All Options:

  • ARs. 37,200\displaystyle \text{Rs. }37,200
  • BRs. 37,000\displaystyle \text{Rs. }37,000
  • CRs. 37,500\displaystyle \text{Rs. }37,500
  • DNone of these

Detailed Solution & Explanation

**Derivation of Principal Amount** Given: - Difference between Compound Interest (CI\displaystyle CI) and Simple Interest (SI\displaystyle SI) for 2\displaystyle 2 years = Rs. 372\displaystyle \text{Rs. }372 - Rate of Interest (r\displaystyle r) = 10%\displaystyle 10\% per annum **Step 1: Set up the formula for difference between CI and SI for 2 years** The formula is: Difference=P(r100)2\text{Difference} = P \left(\frac{r}{100}\right)^2 **Step 2: Substitute the values and solve for Principal (P\displaystyle P)** 372=P(10100)2372 = P \left(\frac{10}{100}\right)^2 372=P(0.1)2372 = P \left(0.1\right)^2 372=0.01P372 = 0.01 P P=3720.01=Rs. 37,200P = \frac{372}{0.01} = \text{Rs. }37,200 Hence, **Option A** is the correct answer.

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