Multiple choice

Ravi invests Rs. 18,000 for 6 years in a scheme with 6% interest per annum, compounded annually. Separately, Manoj invests a certain amount in the same scheme for 4 years, and then reinvests the entire amount he receives at the end of 4 years, for two years at 3% simple interest. If the amounts received by both at the end of 6 years are equal, then the initial investment, in rupees, made by Manoj is

  1. 17,400

  2. 18,250

  3. 18,070

  4. 19,080

  5. a
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Ravi: 18000 * (1.06)^6. Manoj: Let M be investment. After 4 years, amount = M * (1.06)^4. Then reinvested for 2 years at 3% SI: Amount = M * (1.06)^4 * (1 + 0.03 * 2) = M * (1.06)^4 * 1.06 = M * (1.06)^5. Equating: 18000 * (1.06)^6 = M * (1.06)^5. M = 18000 * 1.06 = 19080.

Keep practicing — related questions