Warning: implode(): Invalid arguments passed in /www/wwwroot/jobquiz.info/mdiscuss.php on line 336 An automobile financier claims to be lending money at simple interest, but he includes the interest every six months for calculating the principal. If he is charging an interest of 10%, the effective rate of interest becomes: ?->(Show Answer!)
1. An automobile financier claims to be lending money at simple interest, but he includes the interest every six months for calculating the principal. If he is charging an interest of 10%, the effective rate of interest becomes:
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By: guest on 01 Jun 2017 05.48 pm
Let the sum be Rs. 100. Then, S.I. for first 6 months = Rs. 100 x 10 x 1 = Rs. 5 100 x 2 S.I. for last 6 months = Rs. 105 x 10 x 1 = Rs. 5.25 100 x 2 So, amount at the end of 1 year = Rs. (100 + 5 + 5.25) = Rs. 110.25 Effective rate = (110.25 - 100) = 10.25%