Question Details

A man invested 1/3 of his retirement gratuity at 6% simple interest: 1/4 of his gratuity at 7% and the rest at 8% simple interest. If his annual return on these investments is 7012)5, find the total amount of gratuity invested by the man.

Options

A

89,000

B

99,000

C

95,000

D

1,05,000

Show Answer

Correct Answer :

Option B

99,000

Solution :

The correct option is 99,000.

Step-by-step derivation:

Let the total amount of retirement gratuity invested by the man be represented by G.

According to the problem, the gratuity is divided into three parts and invested at different simple interest rates:
1. First part: 13 of the gratuity is invested at 6% simple interest.
2. Second part: 14 of the gratuity is invested at 7% simple interest.
3. Third part: The remaining ("rest") of the gratuity is invested at 8% simple interest.

First, let us calculate the fraction of the gratuity that makes up the third part (the rest):
Remaining fraction = 1 - 1 3 + 1 4

To add the fractions, find a common denominator, which is 12:
Remaining fraction = 1 - 4 12 + 3 12 = 1 - 7 12 = 5 12

The annual return on these investments is given as 7,012.5 (where "7012)5" is a typographical error for 7,012.50). Using the formula for simple interest for 1 year, Interest=Principal×Rate, we can write the equation for total annual interest as:
1 3 G × 6 100 + 1 4 G × 7 100 + 5 12 G × 8 100 = 7012.5

Simplify each term:
2 100 G + 7 400 G + 40 1200 G = 7012.5

Express all fractions with a common denominator of 1200:
24 G 1200 + 21 G 1200 + 40 G 1200 = 7012.5

Combine the numerators:
24 G + 21 G + 40 G 1200 = 7012.5

Simplify the numerator:
85 G 1200 = 7012.5

Solve for G:
85 G = 7012.5 × 1200

Multiply the values on the right side:
85 G = 8415000

Divide by 85 to find the total investment:
G = 8415000 85


G = 99000

Thus, the total amount of retirement gratuity invested by the man is 99,000.

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