Question

Romesh borrowed Rs 2000 at 2% per annum and Rs 1000 at 5% per annum. He cleared his debt after 2 years by giving Rs 2800 and a watch. What is the cost of the watch?

Answer 1

Principal amount borrowed by Romesh (P) = Rs. 2000
Time period (T) = 2 years
Rate of interest (R) = 2% p.a.

Interest = $\frac{\mathrm{P}\times \mathrm{R}\times \mathrm{T}}{100}=\mathrm{Rs}.\frac{2000\times 2\times 2}{100}=\mathrm{Rs}.80$

Principal amount borrowed by Romesh (P) = Rs. 1000
Time period (T) = 2 years
Rate of interest (R) = 5% p.a.

Interest = $\frac{\mathrm{P}\times \mathrm{R}\times \mathrm{T}}{100}=\mathrm{Rs}.\frac{1000\times 5\times 2}{100}=\mathrm{Rs}.100$

Total amount that he will have to return = Rs. 2000 + 1000 + 80 + 100 = Rs. 3180

Amount repaid = Rs. 2800
Value of the watch = Rs. 3180 - 2800 = Rs. 380