Correct Answer - Option 4 : 50 paisa
Given:
Principal = Rs. 200
Rate = 10%
Formula used:
Simple Interest = (Principal × Rate × Time)/100
Compound Interest = Principal[(1 + rate/100)time - 1]
Calculation:
Simple Interest in 1 year
⇒ (200 × 10 × 1)/100
⇒ 20
Compound Interest compound half yearly
rate = 10/2 = 5%, time = 2
⇒ 200[(1 + 5/100)2 - ]
⇒ 20.5
Difference of interest
⇒ 20.5 - 20
⇒ 0.5
∴ The difference of interest is 0.50 paisa.