Discussion

A money lender finds that due to a fall in the annual rate of interest from 8% to 7 3/4 % his yearly income diminishes by Rs. 61.50, his capital is?

Answer: C

\[ \text{SI} = \frac{P \times R \times T}{100} \]

The fall is \( 8 - 7\tfrac{3}{4} = 0.25 \) percentage points, over one year.

\[ \frac{P \times 0.25 \times 1}{100} = 61.50 \]

\[ 0.0025P = 61.50 \quad\Longrightarrow\quad P = \text{Rs. } 24{,}600 \]

A quarter of a percentage point is a small slice, so it takes a large capital to produce a Rs. 61.50 drop.

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