The sum of ₹500 becomes ₹600 in 2 years at certain rate of simple interest. If the rate of interest is halved, then what amount will ₹500 give in 2 years?

₹550

Given :-

Interest of 2 years = 600 - 500 = 100

Interest of 1 year = \(\frac{100 }{2 }\) = 50

By using formula :-

Simple Interest = \(\frac{Principal ×Rate × Time }{100}\)

50 = \(\frac{500 × Rate × 1}{100}\) 

Rate = 10%

If rate is halved . New rate = \(\frac{10 }{2 }\) = 5%

SI = \(\frac{500 × 5 × 2}{100}\) = 50

Amount = Principal + Simple Interest

= 500 + 50

= Rs. 550