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      Question

      Sri Gupta borrowed a sum at compound interest. What is

      the amount returned in 2 years ? I. The simple interest incurred on the sum in 1 year is 1200. II. The borrowed sum is ten times the amount earned at simple interest in two years. III. The rate of interest is 10% per annum.
      A I and either II or III Correct Answer Incorrect Answer
      B Both I and II Correct Answer Incorrect Answer
      C All I, II and III Correct Answer Incorrect Answer
      D The question cannot be answered even with the information in all three statements. Correct Answer Incorrect Answer
      E None of these Correct Answer Incorrect Answer

      Solution

      From I. R = 5% per annum From II. SI for 1 year = 1200 SI for 2 years = 1200 × 2 = 2400 From III. P = 10 × SI = 10 × 2400 = 24000 Now, from I and II, we get `(SI xx 100)/(P xx T)` = `((2400 xx 100)/(24000 xx 2))` = 5% Therefore amount = P `(1+5/100)` = 24000 `xx` 1.05 `xx` 1.05

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