Multiple choice

A man borrowed Rs. 12,000 at 5% simple interest, Rs. 15,000 at 8% simple interest and Rs. 20,000 at 12% simple interest. He lent all this money to another person at the rate of 10% compounded annually. How much money will the man gain after 2 years?

  1. Rs. 800

  2. Rs. 1060

  3. Rs. 1240

  4. Rs. 1470

  5. None of these
Reveal answer Fill a bubble to check yourself
D Correct answer
AI explanation

The total interest the man must pay on his borrowings is calculated using simple interest, which gives (12000 * 5 * 2)/100 + (15000 * 8 * 2)/100 + (20000 * 12 * 2)/100 = 1200 + 2400 + 4800 = Rs. 8400. The total borrowed amount of Rs. 47000 is lent at 10% compound interest for 2 years, yielding an amount of 47000 * (1.1)^2 = Rs. 56870, meaning his interest received is 56870 - 47000 = Rs. 9870. His overall gain is the difference between the interest received and the interest paid, which is 9870 - 8400 = Rs. 1470.

Keep practicing — related questions