Mathematics for FinanceMTP Nov 18Question 1273 of 512
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If the difference between the interests received from two different banks on 5000\displaystyle 5000 for 2\displaystyle 2 years is 50\displaystyle 50 then the difference between this rates.

Options

A0.25%\displaystyle 0.25\%
B0.40%\displaystyle 0.40\%
C0.50%\displaystyle 0.50\%
D0.70%\displaystyle 0.70\%
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Correct Answer

✅ Option c — 0.50%\displaystyle 0.50\%

All Options:

  • A0.25%\displaystyle 0.25\%
  • B0.40%\displaystyle 0.40\%
  • C0.50%\displaystyle 0.50\%
  • D0.70%\displaystyle 0.70\%

Detailed Solution & Explanation

**Derivation of Difference in Interest Rates** Given: - Principal (P\displaystyle P) = Rs. 5,000\displaystyle \text{Rs. }5,000 - Time (t\displaystyle t) = 2\displaystyle 2 years - Difference in Simple Interest from two banks = Rs. 50\displaystyle \text{Rs. }50 **Step 1: Set up the Simple Interest difference equation** Let the two rates be r1\displaystyle r_1 and r2\displaystyle r_2. SI1−SI2=P×(r1−r2)×t100SI_1 - SI_2 = \frac{P \times (r_1 - r_2) \times t}{100} 50=5000×(r1−r2)×210050 = \frac{5000 \times (r_1 - r_2) \times 2}{100} 50=100(r1−r2)50 = 100 (r_1 - r_2) **Step 2: Solve for the difference in rates** r1−r2=50100=0.50%r_1 - r_2 = \frac{50}{100} = 0.50\% Hence, **Option C** is the correct answer.

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