Multiple choice

A certain sum of money at simple interest amounts to Rs. 1260 in two years and Rs. 1350 in five years. Find the rate percent per annum.

  1. 2.5%

  2. 3.7%

  3. 5.5%

  4. 7.5%
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A Correct answer
Explanation

Interest for 3 years (5-2) = 1350 - 1260 = 90. Interest for 1 year = 30. Interest for 2 years = 60. Principal = 1260 - 60 = 1200. Rate = (Interest * 100) / (P * T) = (60 * 100) / (1200 * 2) = 6000 / 2400 = 2.5%.

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