A man borrows a certain sum of money from a bank and promise to pay the amount in two equal annual installments at the rate of 14\(\frac{2}{7}\)% p.a. If the total interest paid by him was Rs.1840, then find the sum he borrowed.
Answer & explanation
Correct answer: option 2
14\(\frac{2}{7}\)%
Principal : Installment
1st ⇒ 7 : 8
2nd ⇒ 49 : 64
* Installment amount for each year should be same*
Therefore,
Principal : Installment
1st ⇒ 7 : 8 ) × 8
2nd ⇒ 49 : 64 ) × 1
Principal : Installment
1st ⇒ 56 : 64
2nd ⇒ 49 : 64
Sum ⇒ 105 : 128 (Amount)
Interest = 128 - 105 = 23
23 105
↓ ↓
×80 ×80
↓ ↓
1840(given) 8400