If the difference between compound interest and simple interest on Rs 5000 for 2 years at the same annual rate is Rs 72, what is the rate of interest per year?

Explanation

The difference between compound interest and simple interest for 2 years on a principal of Rs 5000 is given as Rs 72. Using the formula for the difference: Difference = (P × R²) / 100², where P = 5000 and Difference = 72, solving for R gives the rate as 12% per annum.