Multiple choice

A money lender lends Rs. 400 for 3 years to a person and lends Rs. 500 for 4 years to the other person at the same rate of simple interest. If altogether he receives Rs. 160 as interest, what is the rate of interest per annum?

  1. 5%

  2. 7%

  3. 9%

  4. 10%
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A Correct answer
Explanation

Total simple interest = (400×3×R/100) + (500×4×R/100) = 12R + 20R = 32R. Given 32R = 160, solving gives R = 5%. The rate of interest is 5% per annum.

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