Compound Interest — Maths STD 8 — Question

ii. Compound Interest (I):
$
\begin{aligned}
& A=P\left[1+\frac{R}{100}\right]^N \\
&=20000\left[1+\frac{8}{100}\right]^2 \\
&=20000\left[\frac{100+8}{100}\right]^2 \\
&=20000\left[\frac{108}{100}\right]^2 \\
&=20000\left[\frac{27 \times 4}{25 \times 4}\right]^2 \\
&=20000\left[\frac{27}{25}\right]^2 \\
&= 20000 \times \frac{27}{25} \times \frac{27}{25} \\
&= 32 \times 27 \times 27 \\
&= \text { Rs } 23,328 \\
& \text { Compound interest (I) } \\
&= \text { Amount (A) }- \text { Principal (P) } \\
&= 23,328-20,000 \\
&= \text { Rs } 3328, . . \text { (ii) }
\end{aligned}
$

iii. Difference
= Compound interest – Simple interest
= 3328 – 3200 … [Form (i) and (ii)]
= Rs 128
∴ The difference between compound interest and simple interest is Rs 128.