Multiple choice

Anamika paid Rs. 4,965 as compound interest on a loan of Rs. 15,000 after 3 years when compounded annually. Suman took a loan of Rs. 10,000 at the same rate on simple interest. How much interest did Suman pay after 3 years?

  1. 3500

  2. 3000

  3. 4500

  4. 4000
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

For compound interest: 4965 = 15000[(1+r)^3 - 1], which gives (1+r)^3 = 1.331, so r = 10%. Simple interest at same rate for 3 years on Rs 10000: SI = 10000 × 10 × 3 / 100 = 3000. The key insight is that the rate must be found first from the compound interest case, then applied to simple interest.

Keep practicing — related questions