Madhya Pradesh Police Exam Model Paper 6

Given:
The principal is 625 rupee
Rate is 8%
Concept:
$\mathit{S}\mathit{I}=\left(\mathit{P}\times \mathit{R}\times \mathit{T}\right)/10$ 0
$\mathit{C}\mathit{I}=\mathit{P}\left[\left(1+\mathit{r}/100\right)\mathit{n}-1\right]$
Here, n is the number of terms in the year.
Calculation:
The simple interest for 2 years
$\Rightarrow \left(625\times 8\times 2\right)/100$
$\Rightarrow 25\times 2\times 2$
⇒ 100 rupee
Now, Compound interest for 2 years is
$\Rightarrow 625\left[\left(1+8/100\right)2-1\right]$
$\Rightarrow 625[\left(108\left[100\right)2-1\right]$
$\Rightarrow 625\left[\left(108\right)2-\left(100\right)2\right]\times 1/10000$
$\Rightarrow \left(208\times 8\right)/16$
⇒ 104 rupee
Now, The difference between CI and SI is
$\Rightarrow 104-100$
⇒ 4
∴ The difference between CI and SI is 4.
The difference between CI and SI for 2 years is $\mathit{P}{\left(\mathit{r}/100\right)}^2$
The difference is
$\Rightarrow 625{\left(8/100\right)}^2$
$\Rightarrow 625\times 4/625$
⇒ 4
∴ The difference between CI and SI is 4.
This short trick works only for 2 years.