📢 Too many exams? Don’t know which one suits you best? Book Your Free Expert 👉 call Now!

    Question

    Ramesh lent Rs. 40,000 to Suresh at compound interest

    of 15% p.a. (compounded annually) for 2 years. Suresh returned the money by calculating simple interest. Find the loss suffered by Ramesh.
    A Rs. 800 Correct Answer Incorrect Answer
    B Rs. 900 Correct Answer Incorrect Answer
    C Rs. 1000 Correct Answer Incorrect Answer
    D Rs. 1200 Correct Answer Incorrect Answer
    E Rs. 1400 Correct Answer Incorrect Answer

    Solution

    Amount due at the end of 2 years
    = 40000 × {1 + (15/100)}²
    = 40000 × (1.15)²
    = 40000 × 1.3225
    = Rs. 52,900 So, interest due = 52,900 − 40,000 = Rs. 12,900 Simple interest due after two years
    = (40,000 × 15 × 2) ÷ 100
    = Rs. 12,000 So, loss incurred by Ramesh
    = 12,900 − 12,000
    = Rs. 900

    Practice Next
    More Simple and compound interest Questions

    Relevant for Exams:

    ask-question