What is the rate of interest at which Rs.150 becomes Rs. 220 in 10 years.
Correct answer: B. 14/3%
- A. 11/3%
- B. 14/3%
- C. 12%
- D. 14%
Explanation
The interest earned is Rs. 220 - Rs. 150 = Rs. 70 over 10 years. Thus, the annual rate is Rs. 70/(Rs. 150 x 10 years) x 100 = 14/3% per annum, approximately 4.67% per annum. The likely trap is 12%, which does not use the 10-year time period correctly.
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Profit and loss compare the cost price and selling price of an item, using profit or loss percentages based on the cost price unless stated otherwise. Questions include marked price, discount, successive discounts, commission, and finding an unknown price, with care needed to distinguish discount from loss.
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