Question

Mr. Hiralal invested ₹ 2,15,000 in a Mutual Fund. He got ₹ 3,05,000 after 2 years. Mr. Ramniklal invested ₹ 1,40,000 at 8% compound interest for 2 years in a bank. Find out the percent gain of each of them. Whose investment was more profitable ?

Answer 1

Mr. Hiralal:

 Amount invested by Mr. Hiralal in mutual fund = ₹ 2,15,000 

Amount received by Mr. Hiralal = ₹ 3,05,000 

∴ Mr. Hiralal’s profit = Amount received – Amount invested 

= 305000 – 215000 = ₹ 90000 

Mr. Hirala’s percentage of profit

 = × 100 

= 41.86% 

Mr. Ramniklal:

P = ₹ 140000, R = 8%, n = 2 years 

∴ Compound interest (I) 

= A – P

= 140000 [(1 + 0.08)² – 1] 

= 140000 [ (1.08)² – 1] 

= 140000(1.1664 – 1) 

= 140000 x 0.1664 

= ₹ 23296

∴ Mr. Ramniklal’s percentage of profit 

= \(\frac{23296}{140000}\) × 100 

= 16.64% 

∴ The percentage gains of Mr. Hiralal and Mr. Ramniklal are 41.86% and 16.64% respectively, and hence, Mr. Hiralal’s investment was more profitable.