If the annual rate of simple interest increases from 11% to $17\frac{1}{2}$, then a person’s yearly income increases by ₹1,071.20. The simple interest (in ₹) on the same sum at 10% for 5 years is:
Answer & explanation
Correct answer: option 3
Principal ( P) = Rs P
Rate of simple interest increases from 11% to $17\frac{1}{2}$ and
so Difference Between two Interest Rates = 17.5 - 11%
= 6.5%
ATQ
6.5% = Rs 1071.20
1% = Rs 164.8
100% = Rs 164800
now Principal = Rs 16480
Rate ( R) = 10%
time ( T) = 5 years
Interest = \(\frac{Principal ×Rate × Time }{100}\)
=\(\frac{ 16480 × 10 × 5 }{100}\)
= Rs 8240