Aptitude - Simple Interest - Discussion

I think the answer should be 35.

The confusion is on whether the rate increases by 2% or the interest itself increases by 2%.
So, let us consider both cases.

CASE 1(Rate 2% increase):
SI = Rs. 1750.
T = 7 years.
R = ?
Let R = R.

P = (SI * 100)/ (R * T)
= (1750 * 100)/(R * 7)
= 25000/R.

Now, if rate is increased by 2%, the new rate = R + (2/100)R.
= 1.02R.
New SI = P * R *T/100.
= (25000/R * 1.02R * 7)/ 100,
= Rs. 1785.00.

Increase in SI = Rs. (1785 - 1750).
= Rs. 35.

CASE 2(SI 2% increase):
Initial SI = Rs. 1750;
After 2% increase, new SI = 1750 + (2/100)*1750,
= Rs.1785.

Increase in SI = Rs.( 1785 - 1750).
=Rs. 35.

For all those who are solving the problem using "2% of R" , R being the Rate of Interest, its not given so in the problem. It's given as 2% more..not 2% of R.

I had been trying to solve using this method and was getting answer as 350.

Then I realized the mistake and I am currently doing the problem as "R+2%".
Now I am not getting the answer since R is not known, as well as P(Principal).

In simple words..do the problem by "R+2%" not by "1.02R"
So the answer is D) Cannot be determined.

Folks, there is a answer for this question and is Rs.35.

As former persons said that answer depends on Amount or principal. its not so.... please check with different principal amount assumptions and match your answers... always same .. 35 is difference and and second case SI is always 1785, never mind whatever assumptions made, if P is assumed 10000 then R comes out to be 2.5% if P is assumed 5000 then R comes out to be 5%, but SI for 2% more rate always is 1785. so there is fix answer for the question.

@All.

Hi, Let me explain.

The answer the author comes up is actually correct.

While we think we can solve this problem by applying 'let x' solution, we are not, however.

This is because we are playing with the rate here and rate(%) is very tricky. Try to solve using 10% rate, you get 350. However, try to use another rate, say, 5%, you get 700 as the difference between the old rate and the plus 2 rate.

I believe in them by saying this question's answer is indeterminable due to lack of data reason.

Assuming the rate of interest to be 10% in 1st case we get;
P=(1750*100)/(10*7),
P=2500.

So applying the principal in 2nd case we get,
S.I=(2500*10.2*7)/100.

Here, the rate of interest is taken to be 10.2 since 2% more of 10 that is assumed in 1st case.

S.I=1785.

So 2nd S.I - 1st S.I will be;

1785-1750=35 This should be the answer but as the rate is not mentioned and it is assumed so the answer may vary from person to person and also method to method of solving.

Here in the first case;

P * 7 * R/100 = 1750 -----> (1)
And in the second case interest is increased by 2%( Rate of interest).

P*7*(R+2)/100=? -------> (2)

HERE THE Rate of Interest is R+2 because the 100 in the demo is for the Rate of Interest Calculation i.e., R/100 is R%.

So, by the two equations, we get 3 unknown values. But to solve 3 unknown values we need 3 equations. hence there is no solution for this question unless one of the 3 unknown values is given.

Here in the first case;

P * 7 * R/100 = 1750 -----> (1)
And in the second case interest is increased by 2%( Rate of interest).

P*7*(R+2)/100=? -------> (2)

HERE THE Rate of Interest is R+2 because the 100 in the demo is for the Rate of Interest Calculation i.e., R/100 is R%.

So, by the two equations, we get 3 unknown values. But to solve 3 unknown values we need 3 equations. hence there is no solution for this question unless one of the 3 unknown values is given.

As according to question the principal is same in both cases. For first case we have: 1750 = (P*R*7)/100.

Again according to question new Rate is 2% more, i.e (R + 2% of R) or (51*R)/50. Now new Interest would be: I = (P*51R*7)/(50*100).

Now solve these two equations by putting value of PR from first in second equation. The answer comes is Rs.35.

Solution given by Singh Abhishek and Rahul are also correct. My way of solving is very basic solution.

Can't the answer be Rs. 255.

Since Rs. 1750 interest earned in 7 years means Rs. 250 interest earned in 1 year.

Now (P*R*T)/100 = SI.

For 1 year, it will be (P*R*1)100 = 250.

i.e P*R = 25000.

Now again, when rate increased by 2%.

For 1 year, it will be (P*102R/100*1)/100 = ?

i.e (P*R*102/100)100 = ?

Putting P*R = 25000 from above.

(25000*102/100)100 gives Rs. 255.

Please correct me if I'm wrong but this is what I think.

i = pxrxt/100.

pxr = (ix100)/t = 25000.

Now we have constant value of pxr.

Now if we are saying that the new rate is 2% more.

Than new rate = r+(2% of r) = r+(2r/100) = r(102/100) = 1.02r.

When new are is 1.02r.

The i = px(new-r)xt/100.

i = px 1.02r x t/100 = (pxr x 1.02 x 7)/100.

We have pxr = 25000 (calculated in first step).

So i = 25000x1.02x7/100 = 1785.

So gain in interest = 1785-1750 = 35.