Arun borrowed a certain sum from Manish at a certain rate of simple interest for 2 years. He lent this sum to Sunil at the same rate of interest compounded annually for the same period. At the end of two years, he received Rs. 2400 as compound interest but paid Rs. 2000 only as simple interest. Find the rate of interest. Choose the correct answer:
A) 40%
B) 30%
C) 20%
D) 10%
E) 5%
Explanation:   Let the sum be x   Simple interest on x for 2 years = Rs.2000   Simple interest = PRT/100   2000 = x Ã— R Ã— 2100   â‡’ x R = 100000 --- (1)   Compound Interest on x for 2 years = 2400   P(1+R/100)T âˆ’ P = 2400   x (1+R/100)2 âˆ’ x = 2400   x (1 +2R/100+R210000)âˆ’x=2400x(2R100+R210000)=2400   2xR/100 + xR2/10000 = 2400--- (2)   Substituting the value of xR from (1) in (2) ,we get   (2Ã—100000)/100 + 100000 Ã— R10000 = 2400   2000+10R = 2400   10R=400   R=40%   40%nswer: Option 40%
<result>A</result>
Arun borrowed a certain sum from Manish at a certain rate of simple interest for 2 years. He lent this sum to Sunil at the same rate of interest compounded annually for the same period. At the end of two years, he received Rs. 2400 as compound interest but paid Rs. 2000 only as simple interest. Find the rate of interest.