A man decided to distribute ₹42 lakhs between his two sons, aged 10 and 17, such that both would receive the same amount when they turn 22. The amount is to be invested at a simple interest rate of 8% per annum until each son turns 22. How much should the elder son receive immediately?
(a) Rs. 2100000
(b) Rs. 2400000
(c) Rs. 2500000
(d) Rs. 2450000

Question

A man decided to distribute ₹42 lakhs between his two sons, aged 10 and 17, such that both would receive the same amount when they turn 22. The amount is to be invested at a simple interest rate of 8% per annum until each son turns 22. How much should the elder son receive immediately?
(a) Rs. 2100000
(b) Rs. 2400000
(c) Rs. 2500000
(d) Rs. 2450000

ONLiNE UPSC · Accepted Answer

Let elder son (age 17) receive ₹ x.
He will earn SI for 5 years (22 &minus; 17):
Final amount = x + (8 * x * 5)/100 = x * (1+0.4) = 1.4x
Let younger son (age 10) receive ₹ (42,00,000 &minus; x).
He will earn SI for 12 years (22 &minus; 10):
Final amount = (42,00,000 &minus; x) * (1 + (8 * 12)/100) = (42,00,000 &minus; x) * (1.96)
Equating both final amounts:
1.4x = (42,00,000 &minus; x) * (1.96) = x = Rs. 24,50,000
Elder son should get ₹ 24,50,000.
Hence, option d is correct.

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A man decided to distribute ₹42 lakhs between his two sons, aged 10 and 17, such that both would receive the same amount when they turn 22. The amount is to be invested at a simple interest rate of 8% per annum until each son turns 22. How much should the elder son receive immediately? (a) Rs. 2100000 (b) Rs. 2400000 (c) Rs. 2500000 (d) Rs. 2450000