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Difference between SI and CI for 2 year @ 10% is Rs. 150. Find the principal.
Difference between SI and CI for 2 year @ 10% is Rs. 150. Find the principal.
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Think about the additional interest earned in the second year on the first-year interest. At $10\%$, this extra amount is $1\%$ of the principal.
Updated On: Aug 14, 2026
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Correct Answer: 15000
Solution and Explanation
Concept:
Step 1: Write the simple-interest amount.
After two years at $10\%$, $A_{SI}=P(1+0.2)=1.2P$.
Step 2: Write the compound-interest amount.
$A_{CI}=P(1.1)^2=1.21P$.
Step 3: Equate the difference to Rs. $150$.
$1.21P-1.2P=0.01P=150$, hence $P=15000$.
Final Answer: Rs. $15{,}000$
- Compare the two-year simple-interest and compound-interest amounts.
- The difference between the amounts equals the difference between the interests.
Step 1: Write the simple-interest amount.
After two years at $10\%$, $A_{SI}=P(1+0.2)=1.2P$.
Step 2: Write the compound-interest amount.
$A_{CI}=P(1.1)^2=1.21P$.
Step 3: Equate the difference to Rs. $150$.
$1.21P-1.2P=0.01P=150$, hence $P=15000$.
Final Answer: Rs. $15{,}000$
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