A certain sum of money invested at R% p.a. fetches a compound interest (compounded annually) of 1400 and simple interest of Rs.1250 at the end of 2 years. Find the value of ‘R’.
Difference between compound interest and simple interest for 2 years = 1400 – 1250 = Rs.150 Simple interest for 1 year = 1250/2 = Rs.625 So, R = (150/625) × 100 = 24%
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