Question
Download Solution PDFTwo banks, A and B, offered loans at 3.5% and 6% per annum, respectively. Chetan borrowed an amount of ₹440000 from each bank. Find the positive difference between the amounts of simple interest paid to the two banks by Chetan after 3 years.
Answer (Detailed Solution Below)
Detailed Solution
Download Solution PDFGiven:
Amount borrowed from bank A = ₹440000
Amount borrowed from bank B = ₹440000
Rate of interest for bank A = 3.5% per annum
Rate of interest for bank B = 6% per annum
Time = 3 years
Formula used:
Simple Interest (SI) = (P × R × T) / 100
Where P = Principal, R = Rate of interest, T = Time
Calculation:
Simple interest for bank A = (440000 × 3.5 × 3) / 100 = 46200
Simple interest for bank B = (440000 × 6 × 3) / 100 = 79200
Difference in simple interest = 79200 - 46200 = 33000
∴ The positive difference in the amounts of simple interest paid to the two banks by Chetan after 3 years is ₹33,000.
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