Question

Simple interest on a certain sum of money for 3 years at 6% per annum is half the compound interest on Rs.1200 for 2 years at 10% per annum. The sum placed on simple interest was?  
1. Rs 700
2. Rs 1400
3. Rs 500
4. Rs 2800

Answer 1

Correct Answer - Option 1 : Rs 700

Formula:

CI = Principle × [(1+\(R \over 100\))ⁿ -1]

Calculation:

Ci = 1200 ×  [(1+\(10 \over 100\))² -1]

     = Rs 252

Now, Simple interest is half the Compound interest

SI = \(252 \over 2\) 

    = Rs 126

126 = P × \(6 \over 100\) × 3

P = Rs 700