Shortcut Trick
When amounts after compound interest are equal, the ratio of shares is inversely proportional to the compounded interest factors.
Ratio of Shan's share to Piyush's share = (1 + R/100)t2 − t1
Ratio = (1 + 8/100)20 − 19 = 108/100 = 27/25
Total parts = 27 + 25 = 52 parts.
Value of 52 parts = ₹1612 ⇒ 1 part = 1612 ÷ 52 = ₹31.
Shan's share = 27 parts = 27 × 31 = ₹837.
∴ The correct answer is ₹837.
Alternate Method
Given:
Total sum given by Rishi = ₹1612
Rate of interest (R) = 8% per annum compounded annually
Time for Shan (t1) = 19 years
Time for Piyush (t2) = 20 years
Let the amount given to Shan be S and to Piyush be P.
Formula Used:
Amount (A) = Principal × (1 + R/100)t
Total Sum = ₹1612
Shan's Share
Time = 19 years
Ratio = 27 parts
Piyush's Share
Time = 20 years
Ratio = 25 parts
Equal Final Amounts
Calculations:
⇒ Amount received by Shan after 19 years = S × (1 + 8/100)19
⇒ Amount received by Piyush after 20 years = P × (1 + 8/100)20
According to the question, both amounts are exactly equal:
⇒ S × (1 + 8/100)19 = P × (1 + 8/100)20
⇒ S/P = (1 + 8/100)20 ÷ (1 + 8/100)19
⇒ S/P = (1 + 8/100)1
⇒ S/P = 108/100
⇒ S/P = 27/25
⇒ Total ratio sum = 27 + 25 = 52 units
⇒ 52 units = ₹1612
⇒ 1 unit = 1612 ÷ 52 = ₹31
⇒ Amount given to Shan (S) = 27 units
⇒ S = 27 × 31 = ₹837
∴ The correct answer is ₹837.
Additional Information
Division of Sum for Equal CI Amount
When a sum is divided into two parts P1 and P2 such that their compound interest amounts are equal after t1 and t2 years respectively at rate R%, the ratio of their principals is always P1/P2 = (1 + R/100)t2 − t1.
Effective Compound Interest
For 2 years, the effective CI rate can be calculated using the successive percentage formula: X + Y + (X × Y)/100. For example, 8% for 2 years gives an effective rate of 8 + 8 + (8 × 8)/100 = 16.64%.
Half-Yearly Compounding
If the interest is compounded half-yearly, the annual rate of interest becomes half (R/2) and the number of compounding cycles is doubled (2T).