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      Question

      A sum was lent at simple interest for 2.5 years. If the

      rate had been 7.5% more, the interest would have been Rs. 375 extra. What was the amount lent?
      A Rs.2000 Correct Answer Incorrect Answer
      B Rs.2500 Correct Answer Incorrect Answer
      C Rs.1520 Correct Answer Incorrect Answer
      D Rs.1800 Correct Answer Incorrect Answer

      Solution

      Let initial rate of interest be r% per annum.
      Let the principal be Rs. P
      According to question;
      P Γ— (r + 7.5)/100 Γ— 2.5 – P Γ— r/100 Γ— 2.5 = 375
      Or, P(r + 7.5) – Pr = 375 Γ— 100/2.5 = 15000
      Or, 7.5P = 15000
      So, P = 15000/7.5 = Rs. 2000

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