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Sunil Borrows Rs.50,000 at 10% S.I. for 1 1 2 Years. He Immediately Invests the Entire Amount for 1 1 2 Years at 10% Compounded Annually. What is His Gain at the End of the Stipulated Time - Mathematics

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Question

Sunil borrows Rs.50,000 at 10% S.I. for 1`(1)/(2)` years. He immediately invests the entire amount for 1`(1)/(2)` years at 10% compounded annually. What is his gain at the end of the stipulated time, when he repays his loan?

Sum
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Solution

To calculate the S.I. paid by Sunil :
P = Rs.50000, R = 10% and T = 1`(1)/(2)` years = `(3)/(2)` years

∴ S.I. = Rs.`(50000 xx 10 xx 3)/(100 xx 2)`
= Rs.7500
To calculate the C.I. earned by Sunil :
For 1st year : P = Rs.50000, R = 10% and T = 1 year

∴ Interest = RS.`(50000 xx 10 xx 1)/(100)`
= Rs.5000
And, amount 
= Rs.50000 + Rs.5000
=Rs. 55000
For next half year : P = Rs.55000, R = 10% and T = `(1)/(2)` year

∴  Interest = Rs.`(55000 xx 10 xx 1)/(100 xx 2)`
 = Rs.2750
And, amount 
= Rs. 55000 + Rs.2750
= Rs.7750
∴  Total C.I. earned
= Rs.55750 + Rs.2750
= Rs.57750
⇒ Sunil's gain in 1`(1)/(2)` year
= C.I. earned - S.I. paid
= Rs.250.

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Concept of Compound Interest - When the Time is Not an Exact Number of Years and the Interest is Compounded Yearly
  Is there an error in this question or solution?
Chapter 3: Compound Interest - Exercise 3.1

APPEARS IN

Frank Mathematics [English] Class 9 ICSE
Chapter 3 Compound Interest
Exercise 3.1 | Q 19

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