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02 Jul 2017, 01:23
00:00

Difficulty:

55% (hard)

Question Stats:

73% (02:41) correct 27% (02:29) wrong based on 89 sessions

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A sum of money invested under simple interest, amounts to $1200 in three years and$1500 in five years. What is the rate at which the sum of money was invested?

(A) 10%
(B) 15%
(C) 20%
(D) 25%
(E) 45%

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02 Jul 2017, 02:44
2
1
The amount at the end of 5 years is 1500 and at the end of 3 years is 1200
Total interest earned in these 2 years = 1500-1200 = 300
Interest earned per year = $$\frac{300}{2}$$ = 150

The original amount invested at the beginning of year 1 = 1200-3*(150) = 1200-450 = 750
Annual rate of interest = $$\frac{150}{750}$$ = $$\frac{1}{5}$$ = 20%

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03 Jul 2017, 10:42
It is given that:
3PR/100 + P = 1200 ------- (1)

PR = 100 (1200 - P)/3 ------- (2)

Also given:
5PR/100 + P = 1500 -----(3)

substituting equation 2 into 3,
500/300*(1200-P) + P = 1500

or P = 750 ----(4)

further substituting (4) into (2)

R is 20%
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17 May 2019, 12:23
3Pr=1200-P 5Pr=1500-P
2Pr= 1500-1200=300 so, Pr=150
So,
P=1200-450=750 ; r=150/750=0,2 or 20%

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