Correct Answer - Option 3 : Rs. 120

**Given:**

Principal = Rs. 12000

Rate = 10%

Time = 2 years

**Formula used:**

SI = (P × R × T)/100

**Calculation:**

SI = (12000 × 10 × 2)/100

⇒ 2400

CI for the first year = (12000 × 10 × 1)/100

⇒ 1200

CI for the second year = (13200 × 10 × 1)/100

⇒ 1320

CI = (1200 + 1320) = 2520

Difference between SI and CI = (2520 – 2400) = 120

**∴ Required difference is Rs. 120**