Question

A person borrows ₹5000 for 2 years at 4% per annum simple interest. He immediately lends it to another person at 14% per annum for 2 years. Find his gain in the transaction after 2 years.​

Answer 1

Answer:

₹1000

Step-by-step explanation:

P=5000

R=4%

T=2 years

SI=5000×4%×2=400

He lends another person @14% pa for 2 years.

So,

SI=5000×14%×2=1400

Gain= 1400-400= 1000

(or)

14%-4%= 10%

Gain=10%×5000×2= 1000

Answer 2

Answer:

Correct option is C)

First case:

P= Rs. 5000,R=4%,T=2 years

Interest paid by him = Rs

100

5000×4×2

= Rs 400

Second case:

P= Rs 5000,R=

4

25

%,T=2 years

Interest he received = Rs

100

5000×6

4

1

×2

= Rs

100×4

5000×25×2

= Rs 625

∴ his gain for two years = Rs 625− Rs 400= Rs 225

His gain per year = Rs

2

225

= Rs 112.50

Hence, option C is correct.