Priyanka borrowed Rs 8000 at 12% simple interest for 3 years and lent it to Renu for 3 years at 15% per annum compound interest, compounded annually, Priyanka’s profit at the end of 3 years is

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1568

1287

2564

None of these.

answer is B.

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Detailed Solution

Concept- The t Therefore, substituting the principal, interest rate, aotal amount she paid to the borrower is equal to the principal multiplied by the sum of the interest rates and the time raised. Second, compound interest is to remove the total amount from the principal and interest. Then she lent money to Renu with a simple interest. The formula for finding simple interest is equal to the product of principal interest, interest rate, and time multiplied by 100.
The principal is assumed to be 8000 rupees. I borrowed money at a simple interest of 12%. The time given is 3 years. Lent has Renu for 3 years. Priyanka lent money at an annual interest rate of 15%. Therefore, to find the money that Priyanka paid the lender with interest,
The formula for finding simple interests is:

S . I = \frac{Principle \times rate \times time}{100}

Then,

Therefore, the amount of interest paid by Priyanka is 2880 rupees. Currently, Priyanka has lent money to Renu with a compound interest of 15%. Therefore, to find the total amount paid by Renu, use the following formula:
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Substituting the principle, rate, and time into the above equation gives:
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The total amount Renu pays is Rs12167. Find compound interest. The formula for calculating compound interest is compound interest = total amount-principal.
Instead of the total amount and the amount of principal, you will receive:

We know the formula for finding the benefits she gets,

Substituting the compound and simple interest values gives:

The money Priyanka earned is Rs. 1287.
Hence, the correct answer is option (2)

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