Multiple choice

Levi earned a certain amount of money from his business of handloom products. He thought he should invest this money to earn some interest, and his friend suggested him to invest this money at different rates of interests. Levi, then, invested 50% of the sum at the rate of 10% per annum. He invested 50% of the remaining at 16% per annum and the rest at 20% per annum. What would be the rate of interest annually, if the interest is calculated on the whole sum?

  1. 11%

  2. 12%

  3. 14%

  4. 15%

  5. 16%
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Let the total sum be 100. 50 is invested at 10% (interest 5). 25 is invested at 16% (interest 4). 25 is invested at 20% (interest 5). Total interest = 5 + 4 + 5 = 14. The annual rate is 14/100 = 14%.

AI explanation

Assume the total sum is 100, so he invests 50 at 10%, yielding 5 interest. The remaining sum is 50, and half of this remaining amount is 25, which is invested at 16% to yield 4 interest; the rest, which is 25, is invested at 20% to yield 5 interest. The total interest is 5 + 4 + 5 = 14 on the principal of 100. Therefore, the average rate of interest on the whole sum is 14%.

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