Multiple choice

An amount of Rs. 15,000 is invested in bank X at a simple interest rate of 4% per annum for a certain number of years. Upon maturity, the total amount is transferred to bank Y, where it is kept for another 4 years at an interest rate of 7% per annum. If the interest earned from bank X and bank Y are in the ratio of 25 : 42, what is the number of years the money was invested in bank X?

  1. 3

  2. 4

  3. 5

  4. 6

  5. 7

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C Correct answer
AI explanation

Let the number of years the money was invested in bank X be T. Using the simple interest formula, the interest from bank X is 15000 multiplied by 4 by T divided by 100, which equals 6000T. The maturity amount from bank X is 15000 + 6000T, and the interest earned from bank Y over 4 years at 7 percent is 28 percent of this maturity amount, which equals 4200 + 1680T. Equating the ratio of the interests to 25:42 gives 6000T divided by (4200 + 1680T) equals 25 divided by 42. Solving this equation, 252000T equals 105000 plus 42000T, which results in 210000T equaling 105000 and T equaling 5. The money was invested in bank X for 5 years.