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A finance company keeps revising the interest rate it offers every year with a constant percentage increase in rate of interest over the previous year. However the rate of interest remains same for a certain investment over the years of investment. If an investment of one lakh rupees in 2010 at 6% rate of simple interest and an investment of one lakh rupees in 2011 amounts to the same sum in 2014, then find the rate of simple interest offered in 2015.
Correct answer is '25.28'. Can you explain this answer?
Verified Answer
A finance company keeps revising the interest rate it offers every yea...
The amount obtained in 2014 by investing 100000 in 2010 = 100000 x (1 + 0.24) = 124000
Let the rate of interest offered in 2011 be r.
Let the rate of interest offered in 2011 be r.
r = 8%
The increase percentage in the offered rate = ( 2 / 6 ) x 100 = 33 .3 3 %
The increase percentage in the offered rate = ( 2 / 6 ) x 100 = 33 .3 3 %
Therate of interest offered in 2015 = 8x(1+1/3)4 = 25 .28 %
Answer: 25.28
This question is part of UPSC exam. View all CAT courses
Most Upvoted Answer
A finance company keeps revising the interest rate it offers every yea...
Given information:
- Investment in 2010: Rs 1 lakh at 6% rate of simple interest
- Investment in 2011: Rs 1 lakh
- Amount in 2014: Same for both investments
Approach:
- Calculate the amount for the investment made in 2010 in 2014
- Calculate the rate of interest for the investment made in 2011 to get the same amount in 2014
- Use the calculated rate of interest to find the rate of interest for the investment in 2015
Calculation:
Step 1: Calculate the amount for the investment made in 2010 in 2014
Using the formula for simple interest:
Amount = Principal + (Principal * Rate * Time)
Where:
- Principal = Rs 1 lakh
- Rate = 6%
- Time = 2014 - 2010 = 4 years
Substituting the values, we get:
Amount = 100,000 + (100,000 * 0.06 * 4) = 100,000 + 24,000 = 124,000
Step 2: Calculate the rate of interest for the investment made in 2011
Let the rate of interest for the investment made in 2011 be 'r'.
Using the formula for simple interest:
Amount = Principal + (Principal * Rate * Time)
Where:
- Principal = Rs 1 lakh
- Rate = r
- Time = 2014 - 2011 = 3 years
Substituting the values and equating it to the amount obtained in Step 1:
124,000 = 100,000 + (100,000 * r * 3)
24,000 = 300,000r
r = 24,000 / 300,000 = 0.08 = 8%
Step 3: Calculate the rate of interest for the investment in 2015
Let the rate of interest for the investment in 2015 be 'x'.
Using the formula for simple interest:
Amount = Principal + (Principal * Rate * Time)
Where:
- Principal = Rs 1 lakh
- Rate = x
- Time = 2015 - 2011 = 4 years
Substituting the values and equating it to the amount obtained in Step 1:
124,000 = 100,000 + (100,000 * x * 4)
24,000 = 400,000x
x =
Community Answer
A finance company keeps revising the interest rate it offers every yea...
We know 6% of 1 lakh = 6000 Rs
So Total amount after 5 years = 6000×5 + 100000 = 130000Rs
In year 2011, Same amount, Same P
So rate = 30000 = 100000×R×4/100 = 1000×R×4. 30000/1000×4 = R. Rate = 7.5%
Now, after 1 year Interest rate increased by = 7.5 - 6 = 1.5.
Percentage increase per year = 1.5×100/6= 25%
So 2015 simple interest rate = 6(1+25/100)^6 = 22.88%.
So Total amount after 5 years = 6000×5 + 100000 = 130000Rs
In year 2011, Same amount, Same P
So rate = 30000 = 100000×R×4/100 = 1000×R×4. 30000/1000×4 = R. Rate = 7.5%
Now, after 1 year Interest rate increased by = 7.5 - 6 = 1.5.
Percentage increase per year = 1.5×100/6= 25%
So 2015 simple interest rate = 6(1+25/100)^6 = 22.88%.
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A finance company keeps revising the interest rate it offers every year with a constant percentage increase in rate of interest over the previous year. However the rate of interest remains same for a certain investment over the years of investment. If an investment of one lakh rupees in 2010 at 6% rate of simple interest and an investment of one lakh rupees in 2011 amounts to the same sum in 2014, then find the rate of simple interest offered in 2015.Correct answer is '25.28'. Can you explain this answer?
Question Description
A finance company keeps revising the interest rate it offers every year with a constant percentage increase in rate of interest over the previous year. However the rate of interest remains same for a certain investment over the years of investment. If an investment of one lakh rupees in 2010 at 6% rate of simple interest and an investment of one lakh rupees in 2011 amounts to the same sum in 2014, then find the rate of simple interest offered in 2015.Correct answer is '25.28'. Can you explain this answer? for CAT 2024 is part of CAT preparation. The Question and answers have been prepared according to the CAT exam syllabus. Information about A finance company keeps revising the interest rate it offers every year with a constant percentage increase in rate of interest over the previous year. However the rate of interest remains same for a certain investment over the years of investment. If an investment of one lakh rupees in 2010 at 6% rate of simple interest and an investment of one lakh rupees in 2011 amounts to the same sum in 2014, then find the rate of simple interest offered in 2015.Correct answer is '25.28'. Can you explain this answer? covers all topics & solutions for CAT 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A finance company keeps revising the interest rate it offers every year with a constant percentage increase in rate of interest over the previous year. However the rate of interest remains same for a certain investment over the years of investment. If an investment of one lakh rupees in 2010 at 6% rate of simple interest and an investment of one lakh rupees in 2011 amounts to the same sum in 2014, then find the rate of simple interest offered in 2015.Correct answer is '25.28'. Can you explain this answer?.
A finance company keeps revising the interest rate it offers every year with a constant percentage increase in rate of interest over the previous year. However the rate of interest remains same for a certain investment over the years of investment. If an investment of one lakh rupees in 2010 at 6% rate of simple interest and an investment of one lakh rupees in 2011 amounts to the same sum in 2014, then find the rate of simple interest offered in 2015.Correct answer is '25.28'. Can you explain this answer? for CAT 2024 is part of CAT preparation. The Question and answers have been prepared according to the CAT exam syllabus. Information about A finance company keeps revising the interest rate it offers every year with a constant percentage increase in rate of interest over the previous year. However the rate of interest remains same for a certain investment over the years of investment. If an investment of one lakh rupees in 2010 at 6% rate of simple interest and an investment of one lakh rupees in 2011 amounts to the same sum in 2014, then find the rate of simple interest offered in 2015.Correct answer is '25.28'. Can you explain this answer? covers all topics & solutions for CAT 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A finance company keeps revising the interest rate it offers every year with a constant percentage increase in rate of interest over the previous year. However the rate of interest remains same for a certain investment over the years of investment. If an investment of one lakh rupees in 2010 at 6% rate of simple interest and an investment of one lakh rupees in 2011 amounts to the same sum in 2014, then find the rate of simple interest offered in 2015.Correct answer is '25.28'. Can you explain this answer?.
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