Question

    Rs. 3,000 becomes Rs. 4,200 in 10 years at simple interest

    of r% p.a. If Rs. 6,000 is invested at 0.5r% p.a. for 6 years, what will be the interest amount?
    A Rs.525 Correct Answer Incorrect Answer
    B Rs.720 Correct Answer Incorrect Answer
    C Rs.650 Correct Answer Incorrect Answer
    D Rs.700 Correct Answer Incorrect Answer

    Solution

    ATQ,

    Interest earned in 10 years = 4200 – 3000 = Rs. 1,200

    Simple interest = Sum invested × rate of interest × time period in years ÷ 100

    So, 1200 = 3000 × r × 10 ÷ 100

    Or, r = 1200 ÷ (10 × 30)

    So, r = 4

    So, new rate of interest = 0.5 × 4 = 2% p.a.

    So, required interest = 6000 × 2 × 6 ÷ 100 = Rs. 720

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