Multiple choice

A and B together borrowed a sum of Rs. 51750 at an interest rate of 7% p.a. compound interest in such a way that to settle the loan, A paid as much amount after three years as paid by B after 4 years from the day of borrowing. The sum (in Rs.) borrowed by A was:

  1. 24860

  2. 26750

  3. 25650

  4. 25000
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Let A borrow amount 'a' and B borrow amount 'b'. At 7% compound interest, A pays a(1.07)³ after 3 years and B pays b(1.07)⁴ after 4 years. These amounts are equal: a(1.07)³ = b(1.07)⁴, so a = 1.07b. Given a + b = 51750, we get 2.07b = 51750, so b = 25000 and a = 26750. Options A and C are incorrect calculations.

Keep practicing — related questions