Multiple choice

The annual income of a person decreases by Rs. 64 if the annual rate of interest decreases from 4% to 3.75%. What is his original annual income?

  1. Rs. 24,000

  2. Rs. 25,000

  3. Rs. 25,600

  4. Rs. 24,600
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

The difference in interest rates is 4% - 3.75% = 0.25%. This 0.25% of the principal equals Rs. 64. Therefore, 0.0025 * P = 64, which leads to P = 64 / 0.0025 = 25,600.

AI explanation

The decrease in annual income is driven by the 0.25% drop in the interest rate (4% minus 3.75%). This means 0.25% of the original principal equals the Rs. 64 decrease in income. Setting up the equation 0.25% of P equals 64, we solve for P to get P equals 64 divided by 0.0025. Calculating this gives an original principal of Rs. 25,600. The original annual income based on the new rate would be 3.75% of 25,600, which is Rs. 960.

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