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What is the rate of interest, if simple interest earned on a certain sum for the 3rd year is Rs. 1,750 and compound interest earned for 2 years is Rs. 3622.5?
- A8
- B9
- C10
- D7
Answer not set
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CCommunity
Simple interest for 3rd year, the duration is only 1 year
Let the rate of interest be 100r
⇒ Simple interest = (Principal × rate × 1)/100
⇒ 1750 = Principal × r ----(1)
Also,
⇒ Compound interest = Principal × [(1 + Rate/100)time - 1]
⇒ 3622.5 = Principal × [(1 + r)2 - 1]
⇒ 3622.5 = Principal × [r2 + 2r]
⇒ 3622.5 = Principal × r × (r + 2) ----(2)
Dividing equation (2) by (1), we get,
⇒ 3622.5/1750 = r + 2
⇒ r = 0.07
∴ Rate = 100r = 7%
Let the rate of interest be 100r
⇒ Simple interest = (Principal × rate × 1)/100
⇒ 1750 = Principal × r ----(1)
Also,
⇒ Compound interest = Principal × [(1 + Rate/100)time - 1]
⇒ 3622.5 = Principal × [(1 + r)2 - 1]
⇒ 3622.5 = Principal × [r2 + 2r]
⇒ 3622.5 = Principal × r × (r + 2) ----(2)
Dividing equation (2) by (1), we get,
⇒ 3622.5/1750 = r + 2
⇒ r = 0.07
∴ Rate = 100r = 7%