A person lent Rs. 23000 to B for 3 years and Rs. 19000 to C for 4 years on simple interest at the same rate of interest and received Rs. 3625 in all from both of them as interest. What is the annual rate of interest?
Answer & explanation
Correct answer: option 3
Money lent to B:
⇒ Principle(P) = 23000, Rate(R) = R%, Time(T)= 3 years
Money lent to C:
⇒ P = 19000, R = R%, T = 4 years
ATQ,
⇒ I1 + I2 = 3625
⇒ \(\frac{P_1\;×\;R_1\;×\;T_1}{100}\) + \(\frac{P_2\;×\;R_2\;×\;T_2}{100}\) = 3625
⇒ \(\frac{23000\;×\;R\;×\;3}{100}\) + \(\frac{19000\;×\;R\;×\;4}{100}\) = 3625
⇒ 690 R + 760 R = 3625
⇒ 1450 R = 3625
⇒ R = \(\frac{3625}{1450}\) = 2.5%