Eight copies of a book can be bought for a certain sum payable at the end of a year and ten copies o...........

Quantitative Aptitude (MTS) Compound Interest

Eight copies of a book can be bought for a certain sum payable at the end of a year and ten copies of the same book can be bought for the same sum in cash money. What is the rate percentage of the interest?

30%

25%

10%

15%

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Explanation:

- We are given that the cost of eight copies with interest after a year equals the cost of ten copies purchased with cash.

- Let the cash price of each book be \( P \). Therefore, the cash price for ten copies is \( 10P \).

- Since this amount is the same as the price after a year with interest of eight copies, the equation becomes: \( 8P(1 + r) = 10P \), where \( r \) is the rate of interest.

- Simplifying, we find: \( 8 + 8r = 10 \).

- Solving for \( r \), we have \( 8r = 2 \) leading to \( r = \frac{2}{8} = 0.25 \).

- Converting 0.25 to a percentage, the rate is 25%.

Option 2: 25%