Question

A man who borrowed a certain sum of money repaid it in parts, by paying Rs.4032 at the end of the first year and Rs.10075 at the end of the second year.
If the rate of simple interest is 12% per annum, what is the sum of money borrowed?

• A. 5
• B. 6
• C. 7
• D. 8
• E. 9

Answer 1

Answer: (D)

Let the principal amount be Rs. $P$.

Amount repaid at the end of the first year Rs.$=4032$
Amount repaid at the end of the second year Rs.$=10075$
Total amount of repayment after second year $=A=4032+10075=Rs.14107$
Time $T=2$ year and rate of interest $=12\%$ per anum.
Since, $A=P(1+\frac{R}{100}{)}^T$
$\Rightarrow 14107=P(1+\frac{12}{100}{)}^2$
$\Rightarrow 14107=P(\frac{112}{100}{)}^2$
$\Rightarrow P=14107\times \frac{100\times 100}{112\times 112}$
$\therefore P=Rs.11246.01$