Two banks, A and B, offered loans at 3.5% and 6% per annum, respectively. Sachin borrowed an amount of ₹460000 from each bank. Find the positive difference between the amounts of simple interest paid to the two banks by Sachin after 2 (in ₹) years.

Correct option is C

Given:

Principal borrowed from bank A = ₹460000

Rate of interest for bank A = 3.5% per annum

Principal borrowed from bank B = ₹460000

Rate of interest for bank B = 6% per annum

Time period = 2 years

Formula Used:

Simple Interest (SI) = $$\frac{P \times R \times T}{100},$$​​

where P is the principal, R is the rate of interest, and T is the time.

Solution:

For bank A:

​$$\text{SI}_A = \frac{460000 \times 3.5 \times 2}{100} = \frac{460000 \times 7}{100} = 32200$$​

For bank B:

​$$\text{SI}_B = \frac{460000 \times 6 \times 2}{100} = \frac{460000 \times 12}{100} = 55200$$​

Positive difference between the interest paid to both banks:

Difference = 55200 - 32200 = 23000

The positive difference between the amounts of simple interest paid to the two banks is ₹23000.