A person lent certain sum of money at the annual rate of 7 percent on simple interest and the interest received in 11 years is Rs. 920 less than the sum lent. What is the sum lent ?
Answer & explanation
Correct answer: option 2
Rate of interest per annum = 7%
Total rate in 11 years = 11 × 7 = 77%
⇒ 77% = \(\frac{77}{100}\)
It means,
Principal = 100 unit
Total Interest = 77 unit
ATQ,
⇒ (100 - 77) unit = Rs.920
⇒ (23) unit = Rs.920
⇒ 1 unit = Rs.40
Hence, 100 unit = 40 × 100 = Rs.4000