Question

Ramesh invests ₹1,200 at 5 % simple interest. How much additional money must he invest at 8 % simple interest so that his total annual income will be equal to 6 % of his total investment during this year ?

Accepted Answer

B. Let additional investment be $A$. Income from ₹1200 at 5% = $1200 	imes 0.05 = ₹60$. Income from $A$ at 8% = $0.08A$. Total income = $60 + 0.08A = 0.06(1200 + A)$. $60 + 0.08A = 72 + 0.06A \implies 0.02A = 12 \implies A = 600$. Hence, Option B is correct.

Simple Interest Investment Mix

Explanation

Practise this under exam conditions