Question

Rohit borrows $Rs.62500$ from Arun for $2$ year at $10$% per annum, simple interest immediately lends out this sum to Kunal at $10$% per annum for the same period, compound annually. Calculate Rohit's profit in the transaction at the end of two years.

Answer 1

Rohit borrowed $=62,500$, $T=2$yrs, $R=10\%$

$S.D=\frac{p+r}{100}=\frac{62,500\times 2\times 10}{100}$

$\Rightarrow 12,500$

Rohit lent $=62,500$, $T=2$yrs, $R=10\%$.(Compounded)

Amount $=62,500{(1+\frac{10}{100})}^2$ $[\because A=P{(1+\frac{1}{100})}^n]$

$=62,500(1.1{)}^2$

$=75625$

C.D$=75625-62500=13125$

Profit $=13125-12500=625$ Rs.