Simple Interest Q34

34.A person borrows Rs. 5000 for 2 years at 4% p.a. simple interest. He immediately lends it to another person at 6¼ p.a for 2 years. Find his gain in the transaction per year.

     A.   Rs. 112.50

     B.   Rs. 125

     C.   Rs. 150

     D.   Rs. 167.50

Answer:

Option : A 

Gain in 2 years	=		5000 x	25	x	2		-		5000 x 4 x 2
				4		100				100

= Rs. (625 - 400)

= Rs. 225

∴ Gain in 1 years	= Rs.		225		= Rs. 112.50
			2