Mr and Mrs Nishant borrow Rs. 5000 for 2 years at the rate of 4% per annum of simple interest and lend it to another person for 2 years at an annual rate of 6.25%. Find the profit received by them…
Question and options
Mr and Mrs Nishant borrow Rs. 5000 for 2 years at the rate of 4% per annum of simple interest and lend it to another person for 2 years at an annual rate of 6.25%. Find the profit received by them every year?
- Rs. 150
- Rs. 112.50
- Rs. 167.50
- Rs. 125
Answer and explanation
Correct answer: B - Rs. 112.50
Interest paid = 5000 x 4% = Rs 200 per year. Interest received = 5000 x 6.25% = Rs 312.50 per year. Yearly profit = 312.50 - 200 = Rs 112.50.
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