Question

Two equal sums were borrowed at 20% simple interest per annum for 2 years and 3 years respectively. The difference in the interest was Rs. 5000. Find the principal amount. 
1. 20000
2. 30000
3. 25000
4. 45000
5. 55000

Answer 1

Correct Answer - Option 3 : 25000

Given:

R = 20%

T = 2 years, 3 years

Difference = Rs. 5000

Formula used:

S.I. = P × R × T/100

Calculation:

Case1 :

⇒ S.I. = P × 20 × 2/100

Case2 :

⇒ S.I. = P × 20 × 3/100

Now,

⇒ (P × 20 × 3/100) - (P × 20 × 2/100) = 5000

⇒ 20 × P/100 = 5000

⇒ P = 25000

∴ Principal amount is Rs. 25000