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      Question

      Mr. Sharma invested Rs. 9600 in Scheme 'A', which offers

      compound interest at a rate of 'r'% per annum, compounded annually for 2 years. After 2 years, he earned Rs. 2,550 as interest. Subsequently, he reinvested the total amount received from Scheme 'A' into Scheme 'B' for a period of 4 years. Scheme 'B' provides simple interest at a rate of (r + 2.5)% per annum. Calculate the interest he earned from Scheme 'B' at the end of 4 years.
      A Rs.7290 Correct Answer Incorrect Answer
      B Rs.7690 Correct Answer Incorrect Answer
      C Rs.8190 Correct Answer Incorrect Answer
      D Rs.6980 Correct Answer Incorrect Answer
      E None of these Correct Answer Incorrect Answer

      Solution

      Total amount received from scheme 'A' = Rs. 9600 + 2550 = Rs. 12150

      We know that, Amount = P x (1 + rate/100) time

      So, 12150 = 9600 (1 + r/100)  2

      Or, (12150/9600) = (1 + r/100)  2

      Or, (81/64) = (1 + r/100)  2

      Or, (9/8)  2  = (1 + r/100)  2

      Or, (9 - 8) /8 = (r/100)

      Or, (1/8) = (r/100)

      Or, 'r' = 12.5

      So, rate of interest for scheme 'B' = (12.5 + 2.5) % = 15%

      So, interest received from scheme 'B' = 12150 X 0.15 X 4 = Rs. 7,290

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