A sum of money invested at simple interest becomes 17/10 of itself in 2 years and 6 months. What is the rate of interest per annum?
Answer & explanation
Correct answer: option 3
If Principal (P) = 100
Then, Interest(I) = Rate(R) × Time(T) .... (i)
So,
Amount = \(\frac{17}{10}\) × 100 = 170
Interest = Amount - Principla = 170 - 100 = 70
T = 2\(\frac{1}{2}\) years OR \(\frac{5}{2}\)
From (i)
⇒ 70 = R×\(\frac{5}{2}\)
⇒ R=28%