Yuvaraj borrowed 30000 each from two banks, for 3 years and 5 years respectively. Find the difference interest paid by him if the rate of interest charged by both banks is 8%.
ANSWER
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Hint: Here, we will find the interest paid by Yuvaraj to both the banks using the formula for calculating the simple interest, which is given as $SI=\dfrac{P\times R\times T}{100}$ . After this we can find the difference of interest paid by him to both the banks.
Complete Step-by-Step solution: The formula for calculating simple interest on a given sum of money is given as: $SI=\dfrac{P\times R\times T}{100}............\left( 1 \right)$ Here, P= principal amount, R= rate and T=time period for which loan is given. In case of the first bank, we have: P= Rs. 30,000 R= 8% T= 3 years On substituting these values in equation (1), we get: $\begin{align} & SI=\dfrac{30000\times 8\times 3}{100} \\ & \Rightarrow SI=7200 \\ \end{align}$ So, in the case of first bank interest is Rs. 7,200. Similarly, in case of second bank, we have: P = Rs. 30,000 R= 8% T = 5 years On putting these values in equation (1), we get: $\begin{align} & SI=\dfrac{30000\times 8\times 5}{100} \\ & \Rightarrow SI=12,000 \\ \end{align}$ So, interest in the case of the second bank is Rs. 12,000. Therefore, difference in the interest charged by both banks = Rs. 12000 – Rs. 7200 = Rs. 4800 Hence, the difference is Rs. 4800.
Note: Students should note here that one can calculate the difference in the charged interests directly by taking the principal amount and rate of interest common because both of them are equal for both banks. It can be done as: $\dfrac{P\times R\times {{T}_{1}}}{100}-\dfrac{P\times R\times {{T}_{2}}}{100}=\dfrac{P\times R}{100}\left( {{T}_{1}}-{{T}_{2}} \right)$ .