Two brothers each invest ₹25000 for three years — one at 12% per annum simple interest, the other at 10% per annum compounded annually. At the end of the three years, how much more (in ₹) does the first brother receive than the second?

Simple interest: $25000\times 12\times 3/100=$ ₹9000. Compound interest: $25000(1.1^3-1)=25000\times 0.331$ = ₹8275. The first brother is ahead by 9000 − 8275 = ₹725. Comparing the two SIMPLE interests, ₹9000 against ₹7500, gives ₹1500 and forgets the compounding; comparing the two COMPOUND amounts gives ₹1848; and ₹500 is only the 2% gap for a single year.