{"id":93282,"date":"2025-06-01T11:46:29","date_gmt":"2025-06-01T11:46:29","guid":{"rendered":"https:\/\/exam.pscnotes.com\/mcq\/?p=93282"},"modified":"2025-06-01T11:46:29","modified_gmt":"2025-06-01T11:46:29","slug":"a-man-takes-a-loan-at-5-simple-interest-for-a-period-of-2-years-he-i","status":"publish","type":"post","link":"https:\/\/exam.pscnotes.com\/mcq\/a-man-takes-a-loan-at-5-simple-interest-for-a-period-of-2-years-he-i\/","title":{"rendered":"A man takes a loan at 5% simple interest for a period of 2 years. He i"},"content":{"rendered":"

A man takes a loan at 5% simple interest for a period of 2 years. He immediately gives this money on loan at 5% compound interest for 2 years. What is the amount of loan he has taken if he makes a profit of \u20b9 2,100 ?<\/p>\n

[amp_mcq option1=”\u20b9 8,00,000″ option2=”\u20b9 4,20,000″ option3=”\u20b9 1,00,000″ option4=”\u20b9 8,40,000″ correct=”option4″]<\/p>\n

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This question was previously asked in<\/div>\n
UPSC CISF-AC-EXE – 2023<\/div>\n<\/div>\n
Download PDF<\/a>Attempt Online<\/a><\/div>\n<\/div>\n
\nLet the principal amount be P. The simple interest (SI) paid by the man for 2 years at 5% is SI = (P * 5 * 2) \/ 100 = 0.10P. The compound interest (CI) received by the man for 2 years at 5% is CI = P(1 + 5\/100)^2 – P = P(1.05)^2 – P = P(1.1025) – P = 0.1025P. The man’s profit is the difference between the CI received and the SI paid: Profit = CI – SI = 0.1025P – 0.10P = 0.0025P. Given the profit is \u20b9 2,100, we have 0.0025P = 2100. Solving for P: P = 2100 \/ 0.0025 = 2100 \/ (1\/400) = 2100 * 400 = \u20b9 8,40,000.
\n<\/section>\n
\n– Simple Interest formula: SI = PRT\/100.
\n– Compound Interest formula: CI = Amount – Principal = P(1 + R\/100)^T – P.
\n– The profit in this scenario is the difference between the interest earned (CI) and the interest paid (SI).
\n– Set up an equation with the profit difference equal to the given profit amount and solve for the principal P.
\n<\/section>\n
\nThis question tests the understanding of simple and compound interest calculations and how to find the profit earned by an intermediary who borrows at one rate\/type and lends at another rate\/type. The difference in interest earned versus interest paid constitutes the profit.
\n<\/section>\n","protected":false},"excerpt":{"rendered":"

A man takes a loan at 5% simple interest for a period of 2 years. He immediately gives this money on loan at 5% compound interest for 2 years. What is the amount of loan he has taken if he makes a profit of \u20b9 2,100 ? [amp_mcq option1=”\u20b9 8,00,000″ option2=”\u20b9 4,20,000″ option3=”\u20b9 1,00,000″ option4=”\u20b9 … <\/p>\n

Detailed SolutionA man takes a loan at 5% simple interest for a period of 2 years. He i<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1089],"tags":[1105,1102],"class_list":["post-93282","post","type-post","status-publish","format-standard","hentry","category-upsc-cisf-ac-exe","tag-1105","tag-quantitative-aptitude-and-reasoning","no-featured-image-padding"],"yoast_head":"\nA man takes a loan at 5% simple interest for a period of 2 years. He i<\/title>\n<meta name=\"description\" content=\"Let the principal amount be P. The simple interest (SI) paid by the man for 2 years at 5% is SI = (P * 5 * 2) \/ 100 = 0.10P. The compound interest (CI) received by the man for 2 years at 5% is CI = P(1 + 5\/100)^2 - P = P(1.05)^2 - P = P(1.1025) - P = 0.1025P. The man's profit is the difference between the CI received and the SI paid: Profit = CI - SI = 0.1025P - 0.10P = 0.0025P. Given the profit is \u20b9 2,100, we have 0.0025P = 2100. Solving for P: P = 2100 \/ 0.0025 = 2100 \/ (1\/400) = 2100 * 400 = \u20b9 8,40,000. - Simple Interest formula: SI = PRT\/100. - Compound Interest formula: CI = Amount - Principal = P(1 + R\/100)^T - P. - The profit in this scenario is the difference between the interest earned (CI) and the interest paid (SI). - Set up an equation with the profit difference equal to the given profit amount and solve for the principal P.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/exam.pscnotes.com\/mcq\/a-man-takes-a-loan-at-5-simple-interest-for-a-period-of-2-years-he-i\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"A man takes a loan at 5% simple interest for a period of 2 years. He i\" \/>\n<meta property=\"og:description\" content=\"Let the principal amount be P. The simple interest (SI) paid by the man for 2 years at 5% is SI = (P * 5 * 2) \/ 100 = 0.10P. The compound interest (CI) received by the man for 2 years at 5% is CI = P(1 + 5\/100)^2 - P = P(1.05)^2 - P = P(1.1025) - P = 0.1025P. The man's profit is the difference between the CI received and the SI paid: Profit = CI - SI = 0.1025P - 0.10P = 0.0025P. Given the profit is \u20b9 2,100, we have 0.0025P = 2100. Solving for P: P = 2100 \/ 0.0025 = 2100 \/ (1\/400) = 2100 * 400 = \u20b9 8,40,000. - Simple Interest formula: SI = PRT\/100. - Compound Interest formula: CI = Amount - Principal = P(1 + R\/100)^T - P. - The profit in this scenario is the difference between the interest earned (CI) and the interest paid (SI). - Set up an equation with the profit difference equal to the given profit amount and solve for the principal P.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/exam.pscnotes.com\/mcq\/a-man-takes-a-loan-at-5-simple-interest-for-a-period-of-2-years-he-i\/\" \/>\n<meta property=\"og:site_name\" content=\"MCQ and Quiz for Exams\" \/>\n<meta property=\"article:published_time\" content=\"2025-06-01T11:46:29+00:00\" \/>\n<meta name=\"author\" content=\"rawan239\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"rawan239\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"1 minute\" \/>\n<!-- \/ Yoast SEO Premium plugin. -->","yoast_head_json":{"title":"A man takes a loan at 5% simple interest for a period of 2 years. He i","description":"Let the principal amount be P. The simple interest (SI) paid by the man for 2 years at 5% is SI = (P * 5 * 2) \/ 100 = 0.10P. The compound interest (CI) received by the man for 2 years at 5% is CI = P(1 + 5\/100)^2 - P = P(1.05)^2 - P = P(1.1025) - P = 0.1025P. The man's profit is the difference between the CI received and the SI paid: Profit = CI - SI = 0.1025P - 0.10P = 0.0025P. Given the profit is \u20b9 2,100, we have 0.0025P = 2100. Solving for P: P = 2100 \/ 0.0025 = 2100 \/ (1\/400) = 2100 * 400 = \u20b9 8,40,000. - Simple Interest formula: SI = PRT\/100. - Compound Interest formula: CI = Amount - Principal = P(1 + R\/100)^T - P. - The profit in this scenario is the difference between the interest earned (CI) and the interest paid (SI). - Set up an equation with the profit difference equal to the given profit amount and solve for the principal P.","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/exam.pscnotes.com\/mcq\/a-man-takes-a-loan-at-5-simple-interest-for-a-period-of-2-years-he-i\/","og_locale":"en_US","og_type":"article","og_title":"A man takes a loan at 5% simple interest for a period of 2 years. He i","og_description":"Let the principal amount be P. The simple interest (SI) paid by the man for 2 years at 5% is SI = (P * 5 * 2) \/ 100 = 0.10P. The compound interest (CI) received by the man for 2 years at 5% is CI = P(1 + 5\/100)^2 - P = P(1.05)^2 - P = P(1.1025) - P = 0.1025P. The man's profit is the difference between the CI received and the SI paid: Profit = CI - SI = 0.1025P - 0.10P = 0.0025P. Given the profit is \u20b9 2,100, we have 0.0025P = 2100. Solving for P: P = 2100 \/ 0.0025 = 2100 \/ (1\/400) = 2100 * 400 = \u20b9 8,40,000. - Simple Interest formula: SI = PRT\/100. - Compound Interest formula: CI = Amount - Principal = P(1 + R\/100)^T - P. - The profit in this scenario is the difference between the interest earned (CI) and the interest paid (SI). - Set up an equation with the profit difference equal to the given profit amount and solve for the principal P.","og_url":"https:\/\/exam.pscnotes.com\/mcq\/a-man-takes-a-loan-at-5-simple-interest-for-a-period-of-2-years-he-i\/","og_site_name":"MCQ and Quiz for Exams","article_published_time":"2025-06-01T11:46:29+00:00","author":"rawan239","twitter_card":"summary_large_image","twitter_misc":{"Written by":"rawan239","Est. reading time":"1 minute"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebPage","@id":"https:\/\/exam.pscnotes.com\/mcq\/a-man-takes-a-loan-at-5-simple-interest-for-a-period-of-2-years-he-i\/","url":"https:\/\/exam.pscnotes.com\/mcq\/a-man-takes-a-loan-at-5-simple-interest-for-a-period-of-2-years-he-i\/","name":"A man takes a loan at 5% simple interest for a period of 2 years. He i","isPartOf":{"@id":"https:\/\/exam.pscnotes.com\/mcq\/#website"},"datePublished":"2025-06-01T11:46:29+00:00","dateModified":"2025-06-01T11:46:29+00:00","author":{"@id":"https:\/\/exam.pscnotes.com\/mcq\/#\/schema\/person\/5807dafeb27d2ec82344d6cbd6c3d209"},"description":"Let the principal amount be P. The simple interest (SI) paid by the man for 2 years at 5% is SI = (P * 5 * 2) \/ 100 = 0.10P. The compound interest (CI) received by the man for 2 years at 5% is CI = P(1 + 5\/100)^2 - P = P(1.05)^2 - P = P(1.1025) - P = 0.1025P. The man's profit is the difference between the CI received and the SI paid: Profit = CI - SI = 0.1025P - 0.10P = 0.0025P. Given the profit is \u20b9 2,100, we have 0.0025P = 2100. Solving for P: P = 2100 \/ 0.0025 = 2100 \/ (1\/400) = 2100 * 400 = \u20b9 8,40,000. - Simple Interest formula: SI = PRT\/100. - Compound Interest formula: CI = Amount - Principal = P(1 + R\/100)^T - P. - The profit in this scenario is the difference between the interest earned (CI) and the interest paid (SI). - Set up an equation with the profit difference equal to the given profit amount and solve for the principal P.","breadcrumb":{"@id":"https:\/\/exam.pscnotes.com\/mcq\/a-man-takes-a-loan-at-5-simple-interest-for-a-period-of-2-years-he-i\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/exam.pscnotes.com\/mcq\/a-man-takes-a-loan-at-5-simple-interest-for-a-period-of-2-years-he-i\/"]}]},{"@type":"BreadcrumbList","@id":"https:\/\/exam.pscnotes.com\/mcq\/a-man-takes-a-loan-at-5-simple-interest-for-a-period-of-2-years-he-i\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/exam.pscnotes.com\/mcq\/"},{"@type":"ListItem","position":2,"name":"UPSC CISF-AC-EXE","item":"https:\/\/exam.pscnotes.com\/mcq\/category\/upsc-cisf-ac-exe\/"},{"@type":"ListItem","position":3,"name":"A man takes a loan at 5% simple interest for a period of 2 years. 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