Question

The given question consists of a set of statements. Find out whether the data provided in the statements are sufficient to answer the question and mark the option:

Saurabh took a loan from bank at a certain compound rate of interest ‘x%’ per annum. Ravi also took a loan although from a different bank at a compound rate of interest ‘y%’ per annum. Who will repay the loan at a greater rate of interest?
I. Saurabh repays the loan with his amount paid being more than that paid by Ravi at the end of the loan periods.
II. Time period for both the loans is 5 years.

• A. if the data in Statement I alone are sufficient to answer the question, while the data in Statement II alone are not sufficient to answer the question;
• B. if the data in statement II alone are sufficient to answer the question, while the data in Statement I alone are not sufficient to answer the question;
• C. if the data even in both Statements I and II together are not sufficient to answer the question;
• D. if the data even in both Statements I and II together are not sufficient to answer the question;
• E. if the data in both statements I and III together are necessary to answer the question.

Answer 1

The correct option is D

if the data even in both Statements I and II together are not sufficient to answer the question;

For Compound Interest,
$A=P(1+\frac{R}{100}{)}^T$

From the statement I, information given is neither related to the initial loan amounts taken by both nor the time period has been mentioned in either case. Hence, the information is not sufficient.

From the statement II, although time periods are mentioned, the initial loan amounts are not known and also the amounts are missing.

Combining both the statements we can get a relative idea about the final loan amounts and the time period but the initial loan taken from the banks are still unknown. We cannot find out the rate of interest in both the cases.