Question

Richard borrows ₹ 10,000 from his friend Ramesh. Ramesh asks him to return the money just by repaying 10 at first day and double the amount in the subsequent days than the each previous day continuously for 10 days. Richard thanks Ramesh for his help. Determine, whether Ramesh was in loss or profit.

Answer 1

Sequence:

10 + 20 + 40 + ......... upto 10 terms.

The above is a G.P. with first term (a) = 10 and common ratio (r) = 2.

By formula,

`S_n = (a(r^n−1))/(r−1)`

Substituting values we get:

⇒ `S_10 = (10 × (2^10 − 1))/(2 − 1)`

= 10 × (1024 − 1)

= 10 × 1023

= 10,230

Since, Ramesh lent ₹ 10,000 but received ₹ 10,230 thus he is in profit of ₹ 230.

Hence, Ramesh makes a profit of ₹ 230.