Ramesh borrowed some money at rate of 5% per annum for the first four years, 8% per annum for the next six years, and 12% per annum for the period beyond ten years. If the total interest paid by him at the end of twelve years is ₹9,016, then find the money borrowed by Ramesh.
Show answer & explanation
Correct answer: B
Explanation
The correct answer is option 2 i.e. ₹9,800.
Given that
For the first 4 years, Rate of interest = 5% p.a.
For the next 6 years, Rate of interest = 8% p.a.
For the next 2 years, Rate of interest = 12% p.a.
Let the money borrowed by Ramesh be P
Formula used
S.I. = PRT/100
where, P = principal, R = rate of interest, T = time
Calculation
⇒ Total interest = ₹9,016
⇒ P × 5 × 4/100 + P × 8 × 6/100 + P × 12 × 2/100 = 9016
⇒ 20P + 48P + 24P = 901600
⇒ 92P = 901600
⇒ P = 901600/92 = ₹9800