Numerical answer
A sum of ₹12,000 is invested at 10% p.a. compounded annually. Find the difference between the compound interest and the simple interest earned over 3 years (in ₹).
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Answer: 372
SI for 3 years = 12000 × 0.10 × 3 = ₹3,600. CI: amount = 12000 × (1.1)³ = 12000 × 1.331 = ₹15,972, so CI = ₹3,972. Difference = 3972 − 3600 = ₹372. Shortcut: for 3 years, CI − SI = P×r²×(3+r)/... but direct computation is safest and fast here.
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