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The difference between the simple interest received from two banks on Rs. 500 for two years is Rs. 2-50. What is the difference between their rates

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The difference between the simple interest received from two banks on Rs. 500 for two years is Rs. 2-50. What is the difference between their rates ?

(a)

0.25%

(b)

0.5%

(c)

1%

(d)

2.5%

Answer:

(a)

Explanation

Let the rates of interest offered by the two banks be R1% and R2% respectively. Then, (500 * R1 * 2)/100 – (500 * R2 * 2)/100 = 250 10R1 – 10R2 = 250 R1 – R2 = 25 The difference between their rates is 25/100 = 0.25% Hence, the correct answer is option (a) 0.25%.