A man invested Rs. 5000 at some rate of simple interest and Rs. 4000…

Question

A man invested Rs. 5000 at some rate of simple interest and Rs. 4000 at 1 percent higher rate of interest. If the interest in both the cases after 4 years is same, the rate of interest in the former case is

Accepted Answer

Option A. 4% p.a.. Answer & Solution Answer: Option A Solution: Let the rates of interest in the former and latter cases be R% and (R + 1) % p.a. Then, & 5000 × R × 4 = 4000 × ( R + 1 ) × 4 & R + 1 R = 5000 × 44000 × 4 & 1 + 1 R = 1 + 1/4 & R = 4 & Hence, & Required rate = 4\% \, p .a .