A person borrows a sum of $7000 for a period of 3 years at a rate of 7% per annum. He immediately lends it to another person for the same time period at the rate of 9% per annum. What is his gain at the end of the tenure on this transaction?
Answers
Answer:420
Step-by-step explanation:
u have to do 7000 by 7/100 by 3 which is 1470 so 7000 +1470=8470 to get the answer u have to do the same but instead multiply by 9/100 =8890 so 8890-8470 =420 which is the answer
The amount he will gain at end = 420 Rs
Given:
A person borrows a sum of $7000 for a period of 3 years at a rate of 7% per annum.
He immediately lends it to another person for the same time period at the rate of 9% per annum
To find:
His total gain at the end of the tenure on this transaction?
Solution:
The amount he borrowed = 7000
at rate R = 7% for time period T = 3
As we know
Simple interest I = (PTR)/100
The interest on 7000 Rs = (7000(3)(7))/100
= 70(3)(7) = 1470 Rs
The amount he needs to pay at end of the 3 years
= 7000 + 1470 = 8470 Rs
He lent 7000 for 3 years at rate 9%
The interest will he get = (7000)(3)(9)/100
= 70(3)(9) = 1890 Rs
The amount he will gain at end of the 3 years
= 7000 + 1890 = 8890 Rs
The amount he will gain = 8890 - 8470 = 420 Rs
The amount he will gain at end = 420 Rs
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