Discussion :: Compound Interest
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Mr. Gupta borrowed a sum of money on compound interest. What will be the amount to be repaid if he is repaying the entire amount at the end of 2 years?
I. The rate of interest is 5 p.c.p.a.
II .Simple interest fetched on the same amount in one year is Rs. 600.
III. The amount borrowed is 10 times the simple interest in 2 years.
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A.
I only |
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B.
III only |
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C.
I or II only |
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D.
II and Either I or III only |
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E.
All I, II and III are required |
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Answer : Option D
Explanation :
I. gives, Rate = 5% p.a.
II. gives, S.I. for 1 year = Rs. 600.
III. gives, sum = 10 x (S.I. for 2 years).
Now I, and II give the sum.
For this sum, C.I. and hence amount can be obtained.
Thus, III is redundant.
Again, II gives S.I. for 2 years = Rs. (600 x 2) = Rs. 1200.
Now, from III, Sum = Rs. (10 x 1200) = Rs . 12000.
Thus, Rate = \( \frac { 100*1200 } { 2*12000 }\) = 5% p.a
Thus, C.I. for 2 years and therefore, amount can be obtained.
Thus, I is redundant.
Hence, I or III redundant.
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