Question
S borrowed some amount from R and promised to pay him 8%
interest. Then S invested the borrowed amount in a scheme, upon which he earned a profit of 5% after paying R, the principal amount with interest. How much percentage R would have gained, if he would have invested in the scheme directly?Solution
Let the amount borrowed be ₹100. S pays R 8% interest, so total repayment = ₹100 + ₹8 = ₹108. S invests ₹100 in a scheme and earns a 5% profit after paying ₹108, so total return from scheme = ₹108 + ₹5 = ₹113. So, the scheme gives ₹113 on ₹100 investment ⇒ profit = ₹13. Percentage gain if R had invested directly = 13/100 x 100 = 13% R would have gained 13%.
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