Aptitude - Simple Interest

A person borrows Rs. 5000 for 2 years at 4% p.a. simple interest. He immediately lends it to another person at 6.25% p.a for 2 years. Find his gain in the transaction per year.

A.  Rs. 112.50

B.  Rs. 125

C.  Rs. 150

D.  Rs. 167.50

View Answer  

Correct Answer :

Rs. 112.50



Explanation :

Interest to be paid by the person = 5000 x 4 x 2 /100 = Rs. 400/-

Interest he receives = 5000 x 6.25 x 2 /100 = Rs. 625/-

His total gain for 2 years = 625 - 400 = 225

So, his gain per year = 225/2 = Rs. 112.50/-


An automobile financier claims to be lending money at simple interest, but he includes the interest every six months for calculating the principal. If he is charging an interest of 10%, the effective rate of interest becomes:

A.  10%

B.  10.25%

C.  10.5%

D.  10.75%

View Answer  

Correct Answer :

10.25%



Explanation :

Let the sum be Rs. 100

Then, S.I for first 6 months = Rs. ( (100 x 10 x 1) / (100 x 2) ) = Rs. 5

S.I for last 6 months = Rs. ( (105 x 10 x 1) / (100 x 2) ) = Rs. 5.25

So, amount at the end of 1 year = Rs. (100 + 5 + 5.25) = Rs. 110.25

=> Effective Rate = (110.25 - 100) = 10.25%


Reena took a loan of Rs. 1200 with simple interest for as many years as the rate of interest. If she paid Rs. 432 as interest at the end of the loan period, what was the rate of interest?

A.  3

B.  6

C.  9

D.  18

View Answer  

Correct Answer :

6



Explanation :

Let Rate = R% and Time = R years

Then, ( 1200 x R x R ) / 100 = 432

=> 12 R² = 432

=> R² = 36

=> R = 6


Mr. Thomas invested an amount of Rs. 13,900 divided in two different schemes A and B at the simple interest rate of 14% p.a. and 11% p.a. respectively. If the total amount of simple interest earned in 2 years be Rs. 3508, what was the amount invested in Scheme B?

A.  Rs. 6200

B.  Rs. 6400

C.  Rs. 6500

D.  Rs. 6600

View Answer  

Correct Answer :

Rs. 6400



Explanation :

Total amount invested = Rs. 13900

Let the sum invested in Scheme A be Rs. Z and that in Scheme B be Rs. (13900 - Z)

Total S.I = Rs. 3508 =  S.I of Scheme A + S.I of Scheme B

3508 = ( (Z x 14 x 2) / 100 ) + ( ( (13900 - Z) x 11 x 2 ) / 100)

=> 350800 - (13900 x 22) = 28Z - 22Z

=> Z = 7500

So, Sum invested in Scheme B = Rs. (13900 - 7500) = Rs. 6400


A sum of money at simple interest amounts to Rs. 815 in 3 years and to Rs. 854 in 4 years. What is the principal?

A.  658

B.  690

C.  698

D.  798

View Answer  

Correct Answer :

698



Explanation :

S.I for ( T2 - T1) years = Change in Amount = A2 - A1

S.I for 1 year = Rs. (854 - 815) = Rs. 39

S.I for 3 years = Rs. (39 x 3) = Rs. 117

Principal = A - S.I

=> Principal = Rs. (815 - 117) = Rs. 698