Multiple choice

A certain sum at a certain rate of simple interest to Rs. 1125 in 4 years and Rs. 1200 in 7 years. Find the rate of interest?

  1. 2.43%

  2. 3.62%

  3. 4%

  4. 5%
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Interest for 3 years (from year 4 to 7) = 1200 - 1125 = 75. Annual interest = 75/3 = 25. Principal = Amount after 4 years - Interest for 4 years = 1125 - 100 = 1025. Rate = (Annual Interest / Principal) × 100 = (25/1025) × 100 = 2.43%. Option B (3.62%), C (4%), and D (5%) are too high.

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