# Aptitude - Simple Interest - Discussion

### Discussion :: Simple Interest - General Questions (Q.No.14)

14.

A person borrows Rs. 5000 for 2 years at 4% p.a. simple interest. He immediately lends it to another person at 6% p.a for 2 years. Find his gain in the transaction per year.

 [A]. Rs. 112.50 [B]. Rs. 125 [C]. Rs. 225 [D]. Rs. 167.50

Explanation:

Gain in 2 years
 = Rs. 5000 x 25 x 2 - 5000 x 4 x 2 4 100 100
= Rs. (625 - 400)
= Rs. 225.

 Gain in 1 year = Rs. 225 = Rs. 112.50 2

Video Explanation: https://youtu.be/zBjcwqIcmL4

 Basudev said: (Jun 11, 2010) Where this 25 come from, I don't understand. Please give the proper solution.

 Sundar said: (Jun 11, 2010) Hi Basudev, We can write 6(1/4) as 25/4. Both are equivalent to 6.25 I hope you understand what I have mentioned here. Have a nice day!

 Bhavya Y J said: (Jun 11, 2010) Where we taking this value 25/4 ?

 Sheik said: (Jun 25, 2010) Its very simple 25/4 is the rate of interests at which he lends it to other person just find s.i. of 5000,4%,2 and 5000,25/4%,2 and subtract the both pls refer 8th std maths book.

 Srinu M said: (Aug 27, 2010) The difference between the interests is 2.25. So interest at 2.25 for 1 year on 5000 is the gain for 1 year = (2.25/100) x 5000 x 1 = 112.5

 Ganesh said: (Jul 30, 2011) Every thing here is fine but at last why did you take average of the gain 225/2=125.50. Please clarify my doubt.

 Mandhapalli Suresh said: (Sep 12, 2011) Actually you are taking 2 years know that is in which the loan lends to another person but we want actual gain if 2 years is 225 means for 1 year 225/2=112. 5 ok.

 Sumit said: (Jan 30, 2012) Simplest method to solve Principle is same Term i.e period is same ONLY lending & borrrowing rate differs So GAIN=Diff between them(25/4-4)% = 9/4% Therefore gain in rupees = 5000*9/4% = 112.5

 Pooja said: (Aug 29, 2012) Thanx Sumit..its really simple:)

 Mary said: (Feb 11, 2014) What is not clear in the qn is whether the interest is lent or the amount is lent after two years?

 Bikash said: (Apr 10, 2014) CASE 1: P = 5000, T = 2, R = 4%. CASE 2: P=5000, T = 2, R = 6.25%. GAIN = 6.25% - 4%. = 2.25%. NOW, 5000*2.25% = 112.5( FOR 1 YEAR).

 Jaya Prakash said: (Jul 6, 2014) From where we got 25/4?

 Gandham Suresh said: (Nov 27, 2014) I really do't know why we have calculated the gain in that way? What is gain? Please send me solution.

 Pranav said: (Mar 18, 2015) At the place of 25/4, we can write 6.25 which is equal to 25/4. And also we can say (6+1/4) year = 6.25.

 Divya S said: (Jun 28, 2015) 6(1/4). 1 is reminder. 4 is divisor. 6 is quotient. Finally get the answer 25/4.

 Vamsi said: (Jul 16, 2015) We can also write 6(1/4) as 4*6+1=25/4.

 Rajesh said: (Dec 25, 2015) ----> 5000*4% = 200. ----> 5000*6.25% = 312.50. ----> 312.50-200 = 112.50. Answer : 112.50.

 Shiva said: (Jun 29, 2016) In the question, 6% is given how you have taken 6.25%.

 Sakshi said: (Aug 19, 2016) What annual investment discharge will discharge a debt of Rs. 1092 due in 3 years at SI 12%? Please anyone answer this.

 Thara said: (Sep 14, 2016) Nice explanation. Thank you all.

 Kiran said: (Nov 5, 2016) Why we taking 25?

 Nisha said: (Dec 28, 2016) Why have we subtracted to get the gain value?

 Sachin said: (Feb 3, 2017) Nice solution. Thank you all.

 Himanshu Baghel said: (Mar 27, 2017) Hi, I have a quesion, please give me the answer. A man land some part of money 15000rs to A at 10% per annum in S.I. if and something part of B at 7% per annum S.I. such that it receive 3870rs total S.I. after 3 years. Find the sum land to A.

 Arun M.K said: (Jun 3, 2017) @Himanshu. x + y = 15000, 0.3x+ 0.21y = 3870, y = 15000 - x. Solving we get x = 8000 and y = 7000. So the sum given to A is 8000.

 Sureshkrishna said: (Jun 14, 2017) In the given data, everything will be same but rate aloe diff So (25/4)-4 = 2.25. Final answer: 5000 * 2.25 = 112.50.

 Anirban Amit said: (Jul 10, 2017) @Himanshu Baghel Ans: For,1st person P=x. 2nd person=15000-x. So, SI=3870. (x*10*3)/100+[(15000-x)*7*3]/100=3870. After calculation answer will be 8000.

 Aswin Lal said: (Sep 21, 2017) Why was 225 divided by 2 in the last step?

 Vallabha Chebiyyam said: (Oct 24, 2017) Because 225 is the gain for 2 years(read the Q) we need to calculate for only 1 year so, 225/2=112.5.

 Kareena said: (Nov 28, 2017) Why are we dividing 225/2?

 Hardik Khirnar said: (Dec 17, 2017) How it is possible? Because here the rate of interest is different for each 2 years. So he gains transaction each year is also different. So the person who is intelligent please clear my concept.

 Shahee said: (Mar 26, 2018) If the time is different. Then how to calculate the gain?

 Ayushi said: (Sep 25, 2018) In this question, it is mention that person lends the amount to another person at (6 1/4) 25/4 pa not 25/4pc. then how come we are considering this 25/4 as a percentage? The answer should be RS. 310.5 according to question. Can anyone clear my this doubt?

 Raj said: (Sep 26, 2018) How come 2 as the denominator in the last step?

 Hussain Ezzy said: (Oct 3, 2018) @All. One can avoid the calculations by simply taking the amount of increase in the rate of interest. i.e Gain rate --> 25/4 = 6.25%. Original Rate --> 4%. increase = 2.25%. Therefore, Gain = (5000x2.25)/100 = 112.5 Rs.

 Animesh said: (Nov 3, 2018) How it is 2/100? Can anyone explain me?

 Swar said: (Nov 24, 2018) 2 denotes the number of years. i.e T, and R % = 6 1/4 = 25/4 % ie 25/(4x100).

 Tejanth said: (May 27, 2019) 6 (1/4) can written as ((6*4)+1)/4. i.e 25/4.

 Niranjan Patil said: (Jul 27, 2019) (5000*25)/400 - (5000*4)/100 = 112.50.

 Sanjana said: (Aug 18, 2019) Why we are taking 25/4 instead of 6/4? => 25/4 = 6.25 and 6/4 = 1.5 then, how both are equal? Why are we adding 6+1/4?

 Halappa said: (Aug 31, 2019) Please, anyone, explain the formula for me.

 Renuka Bhosale said: (Apr 3, 2020) How 25/4 is equal to 6/4?

 Bipin said: (Apr 13, 2020) Hi @Halappa. The formula of simple interest P*T*R /100.