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The differenc e between CI and SI on a certain money invested for three years at 6% per annum is Rs. 110.16. The sum is
  • a)
    Rs. 3000
  • b)
    Rs.3700
  • c)
    Rs.12000
  • d)
    Rs.10000
Correct answer is option 'D'. Can you explain this answer?
Most Upvoted Answer
The differenc e between CI and SI on a certain money invested for thre...
To find the sum invested, we need to understand the concepts of Compound Interest (CI) and Simple Interest (SI). Let's break down the problem step by step.

Step 1: Understanding Compound Interest (CI) and Simple Interest (SI)

Compound Interest (CI) is the amount earned on the initial principal and the accumulated interest from previous periods. It is calculated using the formula:

CI = P(1 + r/n)^(nt) - P

Where:
- P is the principal amount (initial investment)
- r is the annual interest rate (in decimal form)
- n is the number of times interest is compounded per year
- t is the number of years

Simple Interest (SI) is the amount earned on the principal amount only. It is calculated using the formula:

SI = P * r * t

Where:
- P is the principal amount (initial investment)
- r is the annual interest rate (in decimal form)
- t is the number of years

Step 2: Identifying the given information

From the problem, we know the following:
- The interest rate is 6% per annum (0.06 in decimal form)
- The difference between CI and SI for 3 years is Rs. 110.16

Step 3: Setting up the equations

Let's assume the principal amount is P.

The compound interest (CI) can be calculated using the formula mentioned above:

CI = P(1 + r/n)^(nt) - P

The simple interest (SI) can be calculated using the formula mentioned above:

SI = P * r * t

The difference between CI and SI is given as Rs. 110.16:

CI - SI = Rs. 110.16

Substituting the values, we get:

P(1 + 0.06/1)^(1*3) - P - P * 0.06 * 3 = Rs. 110.16

Simplifying the equation further:

P(1.06)^3 - P - 0.18P = Rs. 110.16

P(1.191016) - 1.18P = Rs. 110.16

0.191016P = Rs. 110.16

P = Rs. 110.16 / 0.191016

P = Rs. 577.08

Therefore, the sum invested is Rs. 577.08.

Step 4: Checking the options

None of the given options match the calculated sum. However, it is possible that there is an error in the calculations or the options provided. It is advisable to double-check the calculations and compare with the given options to find the correct answer.
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The differenc e between CI and SI on a certain money invested for three years at 6% per annum is Rs. 110.16. The sum isa)Rs. 3000b)Rs.3700c)Rs.12000d)Rs.10000Correct answer is option 'D'. Can you explain this answer?
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The differenc e between CI and SI on a certain money invested for three years at 6% per annum is Rs. 110.16. The sum isa)Rs. 3000b)Rs.3700c)Rs.12000d)Rs.10000Correct answer is option 'D'. Can you explain this answer? for CA Foundation 2025 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about The differenc e between CI and SI on a certain money invested for three years at 6% per annum is Rs. 110.16. The sum isa)Rs. 3000b)Rs.3700c)Rs.12000d)Rs.10000Correct answer is option 'D'. Can you explain this answer? covers all topics & solutions for CA Foundation 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for The differenc e between CI and SI on a certain money invested for three years at 6% per annum is Rs. 110.16. The sum isa)Rs. 3000b)Rs.3700c)Rs.12000d)Rs.10000Correct answer is option 'D'. Can you explain this answer?.
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