What is the difference between the simple interest and the compound interest at 9% per annum for 2 years on a principal of Tk 7000?

Question: What is the difference between the simple interest and the compound interest at 9% per annum for 2 years on a principal of Tk 7000?

Solution:
We know, Simple Interest, I = Pnr
and Compound Principal, C = p(1 + r)ⁿ

Simple Interest = 7000 × 2 × (9/100) = 1260 Tk

Compound Principal = 7000 × {1 + (9/100)}²
= 7000 × (109/100)²
= (7000 × 109 × 109)/(100 × 100)
= 8316.7 Tk.

So, Compound interest = 8316.7 - 7000 = 1316.7 Tk

So, difference = 1316.7 - 1260 = 56.7 Tk