Question

15 Vikram borrowed 20000 from a bank at 10% per annum simple interest. He lent it to his friend Venkat at the same rate but compounded annually. Find his gain after 2+1/2 years​

Answer 1

Given:-

• Vikram borrowed 20000 from a bank at 10% per annum simple interest. He lent it to his friend Venkat at the same rate but compounded annually.

To find:-

• Find his gain after 2+1/2 years​

Answer:-

Case----(1)

Principal= 20000

Rate = 10% p.a

Period = 2 1/2 = 5/2 years

We know that

Simple interest = Prt/100

Substituting the values

⇒(20000 × 10 × 5) / (100 × 2)

⇒5000

Case----(2)

Principal = 20000

Rate = 10% p.a.

Period = 2 1/2 year at compound interest

We know that

Amount = P(1+r/100)^n

 

Substituting the values

⇒20000(1+10/100) ²(1+10/(2×100)) ²

By further calculation

⇒20000×11/10×11/10×21/20

⇒25410

Here

Compound interest = A - P

Substituting the values

⇒25410−20000

⇒5410

So his gain after 2 years = CI - SI

We get

⇒5410−5000

⇒410

Therefore, the gain is "410".