Question

Mr Sharma lends 34,00,000 to Mr Ganguly at
9.5% interest p.a., who in tum lends 33,50,000 to
Mr Choubey at 10.5% interest p.a. At the end of two
years will Mr Ganguly be receiving or paying interest?
What will be his net receipt or payment?​

Answer 1

Greetings..!

Case 1:

Principal(p) lent out by Mr Sharma to Mr Ganguly=Rs 34,00,000

Rate(r) of interest= 9.5% p.a

Time(t)=2 years

So , we need to find out the simple interest from here by using its formula which is:

S.I=(p*r*t)/100

=>(3400000*9.5*2)/100

=>Rs  646000(Note this is the money he has to pay at the end of 2 years)

Case 2:

Principal(p) lent out by  Mr Ganguly to Mr Choubey=Rs 33,50,000

Rate(r) of interest=10.5%

Time(t)=2 years

∴S.I=(p*r*t)/100

=>(3350000*10.5*2)/100

=>Rs 703500(note this is the money Mr Ganguly receives at the end of 2 years)

So, clearly Rs 703500 >  646000

So, he will be receiving.

Now, amount of receipt is=Money he receives-money he pays=

Rs(703500 -  646000)=Rs 57500

Hence,Mr Ganguly at the end of 2 years receives Rs 57500.(ANSWER)

Cheers..!