Aptitude - Simple Interest - Discussion
Discussion Forum : Simple Interest - General Questions (Q.No. 7)
7.
An automobile financier claims to be lending money at simple interest, but he includes the interest every six months for calculating the principal. If he is charging an interest of 10%, the effective rate of interest becomes:
Answer: Option
Explanation:
Let the sum be Rs. 100. Then,
| S.I. for first 6 months = Rs. |  |
100 x 10 x 1 |  |
= Rs. 5 |
| 100 x 2 |
| S.I. for last 6 months = Rs. | |
105 x 10 x 1 | |
= Rs. 5.25 |
| 100 x 2 |
So, amount at the end of 1 year = Rs. (100 + 5 + 5.25) = Rs. 110.25
Effective rate = (110.25 - 100) = 10.25%
Discussion:
118 comments Page 10 of 12.
Pramod Kajla said:
1 decade ago
Time should be mentioned in the question as 1 year.
Pramod Kajla said:
1 decade ago
Time should be mentioned in the question as 1 year.
Janani said:
1 decade ago
How we do without time friends? How you took 1 yr?
Pankaj Shelke said:
3 years ago
Why We consider 100 at starting?
Please explain.
Please explain.
(22)
Yolo said:
2 years ago
Why didn't we use (1+i)^n-1 here? Please explain.
(3)
Tshering Tobgay said:
1 year ago
R = e^i-1
= e^(0.1)-1
= 1.105-1
= 0.105
= 10.5%.
= e^(0.1)-1
= 1.105-1
= 0.105
= 10.5%.
(6)
Rose said:
1 decade ago
Please can anyone give a better explanation.
M.s.Kumar said:
5 years ago
Easy and clear explanation, Thanks @Saiteja.
Punna said:
1 decade ago
Why we take last 6 months principal as 105?
(1)
Himika said:
1 decade ago
Hows it possible to solve without time?
(1)
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