A lends ₹5,000 at a rate of 5% for 4 years, while B lends ₹4,000 at a rate of 6% for 3 years. Who earns more simple interest?
Show answer & explanation
Correct answer: A
Explanation
A: ₹5,000, 4 years, 5%
B: ₹4,000, 3 years, 6%
Simple Interest = (P × R × T)/100
Interest for A = (5000 × 5 × 4)/100 = 1000
Interest for B = (4000 × 6 × 3)/100 = 720
⇒ 1000 > 720
A earns more interest.