The difference between compound interest (compounding annually) and simple interest on a sum of Rs. 10,00,000 for 2 years is Rs. 2401. Find the rate of interest per annum.

Correct option is A

Given: Principal = 1000000, Time = 2 years, Difference in interests = 2401
Formula Used: Difference = $$P \times {(\frac{R}{ 100})}^2$$​​
Solution:
2401 = 1000000 $$\times \frac{R^2}{10000}$$

​$$\frac{2401}{100} = R^2$$

​$$R = \sqrt{\frac{2401}{100}}$$

R = 4.9%