The difference between the simple interests received from two different sources on Rs 2500 for 2 years is Rs 12.50. What is the difference between their rates of interest?
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → 0.25%
The principal and the time are the same for both sources, so the difference of the interests comes only from the difference of the rates: \(\displaystyle \text{SI difference}=\frac{P\times(\text{rate difference})\times T}{100}\).
\(\displaystyle \frac{2500\times d\times2}{100}=12.50\), where \(d\) is the difference of the rates
\(50d=12.50\)
\(d=0.25\)
The rates differ by 0.25% per annum.