Here’s and example of a **SMART MATH** problem for **PERCENTAGES.**

**Problem**

**Problem**

If the rate of Compound interest and Simple interest is the same and the difference between the interest earned on a principal of $8000 over 2 years is $180, find the interest rate.

- 12%
- 15%
- 10%
- 18%
- 20%

**The Usual Method**

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Let the rate of interest be ‘*r*’%.

Simple interest earned over two years

=

Compound interest earned over two years

=

Hence, difference is given by

– = 180

%

** **

**(Ans: 2)**

*Estimated Time to arrive at the answer = 90 seconds.*

**Using Technique**

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Remember that the difference of $180 is nothing but the interest on interest earned in the 2^{nd} year.

Interest earned in 1^{st} year by Compound as well as Simple is the same = 80*r*

Interest earned on this interest in the next year =

% i.e option ‘2’.

**(Ans: 2)**

*Estimated Time to arrive at the answer = 10 seconds.*

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