Multiple choice

Arun invested a sum of money at a certain rate of simple interest, for a period of four years. If he had invested the same sum for a period of six years, the total interest earned by him would have been fifty percent more than the earlier interest amount. What was the rate of interest per annum?

  1. 4%

  2. 8%

  3. 5%

  4. Cannot be determined

  5. None of these
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Interest I = P*R*T/100. I1 = P*R*4/100. I2 = P*R*6/100. I2 = 1.5 * I1. 6PR/100 = 1.5 * 4PR/100. 6 = 6. This is an identity that holds for any R. Therefore, the rate cannot be determined.

AI explanation

Let the principal be P and the rate be R. The interest for six years is P times R times 6 divided by 100, and the interest for four years is P times R times 4 divided by 100. Setting the six-year interest equal to 1.5 times the four-year interest yields 6 equals 6, which is an identity that reveals no specific value for the rate. Therefore, the rate of interest per annum cannot be determined from the given information.

Keep practicing — related questions