The simple interest on a certain sum of money at rate of interest 6% per annum for 2 years is Rs. 960. What is the compound interest (compounding annually) on the same sum for the same period and at the same rate of interest?

Correct option is B

​Given:
- Simple Interest (SI) = Rs. 960
- Rate of Interest = 6%
- Time = 2 years
Formula Used:
 SI = (P × R × T) / 100
 Compound Interest (CI) = $$P × (1 + R/100)^T - P$$​​
Solution:
SI = (P × R × T) / 100
960 = (P × 6 × 2) / 100
P = Rs. 8000
Compound Interest (CI) = P × (1 + R/100)$$^2$$​ - P
CI = 8000 × (1 + 6/100)$$^2$$​- 8000
CI = 8000 × 1.06$$^2$$​ - 8000
CI = 8000 × 1.1236 - 8000
CI = Rs.988.88