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GATE 2024 AR — Architecture – Question 8

General Aptitude · Quantitative Aptitude: Data Interpretation, Arithmetic and Number Computation · 2 marks · Multiple choice

Person 1 and Person 2 invest in three mutual funds A, B, and C. The amounts they invest in each of these mutual funds are given in the table.

Mutual fund AMutual fund BMutual fund C
Person 1₹10, 000₹20, 000₹20, 000
Person 2₹20, 000₹15, 000₹15, 000

At the end of one year, the total amount that Person 1 gets is ₹500 more than Person 2. The annual rate of return for the mutual funds B and C is 15% each. What is the annual rate of return for the mutual fund A?

  1. 7.5%
  2. 10%
  3. 15%
  4. 20%

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Show answer and explanation

Correct answer: (B) 10%

Explanation

Let r be the annual return fraction of fund A. Person 1 earns ₹6000 from funds B and C, and ₹10000r from A. Person 2 earns ₹4500 from B and C, and ₹20000r from A. Their difference is therefore ₹(1500−10000r). Set this equal to ₹500: 10000r=1000, giving r=0.10. Thus A returns 10%, option B. Both invested ₹50000, so comparing final amounts gives the same difference as comparing their gains.

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