Multiple choice

A principal amount to Rs. 944 in 3 years and to Rs. 1040 in 5 years, each sum being invested at the same simple interest. The principal was-

  1. Rs. 800

  2. Rs. 992

  3. Rs. 750

  4. Rs. 900
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A Correct answer
Explanation

For simple interest, Amount = P(1 + rt/100). Let P be principal and R be rate. Then P(1 + 3R/100) = 944 and P(1 + 5R/100) = 1040. Dividing gives (1 + 5R/100)/(1 + 3R/100) = 1040/944 = 65/59. Solving: 59(100 + 5R) = 65(100 + 3R), giving R = 6%. Substituting back: P(1 + 18/100) = 944, so P = 94400/118 = Rs. 800.

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