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If the compound interest on a sum for 2 years at 12.5% p.a. is rs. 510, the simple interest on the same sum at the same rate for the same period of time is 

If the compound interest on a sum for 2 years at 12.5% p.a. is rs. 510, the simple interest on the same sum at the same rate for the same period of time is 
1). Rs. 400
2). Rs. 450
3). Rs. 460
4). Rs. 480
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Formulas to be used: -

SI, I = (P × r × t)/100

For CI:

$(A\; = \;P\;{\left( {\;1\; + \frac{r}{{100}}} \right)^t})$; CI = A – P

Where SI is Simple interest,

A is the amount on CI at the end of time t,

P is the principal,

t is time,

r is rate

Given, compound interest on a sum for 2 years at 12.5 p.a. is rs. 510.

$(A = P\;{\left( {\;1 + \frac{{12.5}}{{100}}} \right)^2})$

⇒ A = P(1.125)2

⇒ A = 1.265625P       

CI = A – P

⇒ CI = 1.265625P – P

⇒ CI = 0.265625P

Given, CI = Rs. 510

∴ 0.265625P = 510

⇒ P = Rs. 1920

SI on the same sum at the same rate for the same period of time is:

SI = (1920 × 12.5 × 2)/100

⇒ SI = Rs. 480
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