The difference between the compound interest, compounded annually, and the simpleinterest earned on a certain sum of money in two years at 10% interest per annum, is₹197.2. Find the sum invested.

Correct option is A

Given:

Time = 2 years

Rate = 10% per annum

Difference between CI and SI = ₹197.2

Formula Used:

The difference between compound interest and simple interest for 2 years:

​$$CI − SI = P \times \left(\frac{R}{100}\right)^2$$​​

Solution:

Substitute the values into the formula:

​$$197.2 = P \times \frac{10^2}{100^2}$$​​

​$$= P \times \frac{100}{10000}$$​​

​$$= P \times \frac{1}{100}$$​​

= ₹19,720