Question

Bharathi Barrows an amount of 12500 at 12%per annum for 3 years at a simple interest and madhuri borrows the same amount for the same time period at 10%per annum, compounded annually who pays more interest and by how much?

Answer 1

bharathi pays more...

hope u understand...

Answer 2

the amount borrowed by Bharat

p = Rs 12500 , time ( t) = 3yrs

rate(r) = 12 % p.a at a simple interest .

Find the interest paid by Bharat :

S.I = p × r × t / 100

S.I = 12500 × 12 × 3 /100

=125 × 36 = Rs 4500

Interest paid by Bharat = Rs 4500

according to second statement:

given that the Madhuri borrows the same amount for the same time .

P = 12500 , time = 3yr, rate ( r ) = 10 %

per annum compounded annually.

then,Find the interest paid by madhuri :

A = p ( 1 + ( r / 100 ) ]^t

= 12500 [ 1 + ( 10/100 ) ]^3

= 12500 × 11 / 10 × 11 /10 × 11 / 10

= (125 × 1331 ) / 10 = Rs 16637.5

since , we know C.I = A - P

= Rs 16637.5 - Rs 12500

= Rs 4137.5

interest paid by Madhuri = Rs 4137.5

difference = 4500 - 4137.5 = Rs 362.5

therefore , Bharat pays Rs 362.5 more than the interest paid by madhuri .

Your Answer : Rs 362.5
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