Correct Answer - Option 1 : Rs 50000
Given
The difference between the compound interest and simple interest on a certain sum of money at 10% per annum for 2 years is Rs 500.
Formula used
CI - SI = (P × R2)/(100)2
CI = Compound interest
SI = Simple interest
P = Principal
R = Rate
Calculation
According to question
⇒ 500 = (P × (10)2)/10000
⇒ P = (500 × 10000)/100
∴ Principal is Rs.50000