Practicing Success

Target Exam

CUET

Subject

General Test

Chapter

Numerical Ability

Topic

Simple Interest

Question:

₹2,500, when invested for 8 years at a given rate of simple interest per year, amounted to ₹ 3,725 on maturity. What was the rate of simple interest that was paid per annum?

Options:

6%

6.125%

6.25%

5.875%

Correct Answer:

6.125%

Explanation:

Principal = Rs 2500

Amount =  Rs 3725

Interest  =  Amount - Principal = 3725 - 2500 = Rs 1225

Interest  = 1225 for 8 years 

Interest for 1 year = \(\frac{1225}{8}\)

∴  Rate% = \(\frac{Interest}{Principal}\) × 100

∴  Rate% = \(\frac{1225/8}{2500}\) × 100 = 6.125%