Question
A person invests Rs. ‘a’ in SIP A and Rs. ‘b’ in
SIP B. SIP A offers simple interest at 15% per annum, while SIP B offers compound interest at 20% per annum. After 3 years, the interest earned from SIP A is Rs. 5400, which is Rs. 4610 less than the interest earned from SIP B over the same period. Determine the value of (b – a).Solution
ATQ,
Simple interest from SIP 'A' = Rs. 5400 So, a × 0.15 × 3 = 5400 a = 12000 Compound interest from SIP 'B' = 5400 + 4610 = Rs. 10010 So, b × {(1.2)³ – 1} = 10010 0.728b = 10010 b = 13750 Therefore, (b – a) = 13750 – 12000 = Rs. 1750
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