Question

A person borrows $ 5000 for 2 years at 4% p.a simple interst. He lends to it to another person at 25/4% 2years. find his gain in the transaction per years

Answer 1

Interest he has to pay

I=PRN/100

= (5000*4*2)/100

=$. 400

Interest he will receive

= (5000*25*2)/(4*100)

= $625

So he will gain $225 ($625-$400)