Multiple choice

Rs. $2500$ becomes Rs.$ 3100$ in four years when the interest is simple. If the rate of interest is increased by $4$% then what will be the total amount after two years?

  1. $2000$
  2. $3000$
  3. $4000$
  4. $5000$
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Simple interest for 4 years = 3100 - 2500 = 600. Rate = (600 * 100) / (2500 * 4) = 6%. New rate = 6% + 4% = 10%. Interest for 2 years at 10% = (2500 * 10 * 2) / 100 = 500. Total amount = 2500 + 500 = 3000.

AI explanation

Using the simple interest formula, the original rate is calculated as ((3100 - 2500) * 100) / (2500 * 4) = 6%. Increasing this rate by 4% gives a new rate of 10%. The simple interest for two years at this new rate is (2500 * 10 * 2) / 100 = Rs. 500, making the total amount 2500 + 500 = Rs. 3000.

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