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    Question

    A certain sum amounts to Rs. 2000 in 1 year and to Rs.

    2420 in 2 years, when invested at R% p.a. compound interest, compounded annually. Find the amount received when Rs. 4000 is invested at (R – 5)% p.a. simple interest for 3 years.
    A Rs. 5200 Correct Answer Incorrect Answer
    B Rs. 5600 Correct Answer Incorrect Answer
    C Rs. 5800 Correct Answer Incorrect Answer
    D Rs. 5920 Correct Answer Incorrect Answer
    E None of these Correct Answer Incorrect Answer

    Solution

    Let, the sum invested at compound interest be Rs. ‘P’ According to the question, {P(1 + R/100)²}/{P(1 + R/100)} = 2420/2000 Or, (1 + R/100) = 1.21 = (1 + 21/100) Or, R = 21 Therefore, new rate of interest = 21 – 5 = 16% Required amount received at simple interest
    = {(4000 × 16 × 3)/100} + 4000
    = 1920 + 4000
    = Rs. 5920

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