Mawa Lal borrowed Rs 20000 from his friend Rooplal at 18% per annum simple interest . He lent it to Rampal at the same rate but compounded annually. Find his gain after 2 years.

Explanation

To solve the problem step by step, we will first calculate the simple interest that Mawa Lal has to pay to Rooplal, and then we will calculate the compound interest that he earns from Rampal. Finally, we will find Mawa Lal's gain after 2 years.

### Step 1: Calculate Simple Interest (SI) for Mawa Lal

The formula for calculating Simple Interest is:
\[ SI = \frac{P \times R \times T}{100} \]
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