AFCAT Model Paper 10

Given:
Ratio of difference between CI and SI for 3 years and 2 years respectively = 25: 8
Formula used:
Difference between CI and SI for 3 years =PR2

(R+300)

1003

Difference between CI and SI for 2 years =

PR2

1002

Calculation:
According to question:

[PR2 (R+300) 1003 ]

[ PR2 1002 ]

=

25

8

Solving LHS:
⇒[

(R+300)

1003

]×1002
⇒

(R+300)

100

=(

R

100

)+3 or R%+3
Now, R% +3=

25

8

⇒ R% =(

25

8

)−3=

1

8

∴ Rate of interest =

1

8

=12.5%