Question
If Rs. 12,500 is invested at simple interest for 2.5
years and the total amount becomes Rs. 15,625, what is the rate of interest per annum?Solution
ATQ,
Interest earned = 15,625 - 12,500 = Rs. 3,125
Simple interest = (Principal × Rate × Time) ÷ 100
So, 3,125 = (12,500 × r × 2.5) ÷ 100
Or, 3,125 = 312.5 × r
Or, r = 3,125 ÷ 312.5 = 10
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