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Question
"A” and "B” have to clear their respective loans by paying 3 equal annual installments of Rs.4,00,000 each. "A” pays at 10% per annum of simple interest while "B” pays 10% per annum compound interest. What is the difference in their payments?
"A” and "B” have to clear their respective loans by paying 3 equal annual installments of Rs.4,00,000 each. "A” pays at 10% per annum of simple interest while "B” pays 10% per annum compound interest. What is the difference in their payments?
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Solution
The correct option is D 4000
- 4, 00, 000{1 + 1.1 + (1.1)2} - 4, 00, 000{1 + 1.1 + 1.2} = 4000. Option(d).
4000
- 4, 00, 000{1 + 1.1 + (1.1)2} - 4, 00, 000{1 + 1.1 + 1.2} = 4000. Option(d).
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