Multiple choice

Mohan lent the sum of Rs. 525.75 at simple interest. At the end of 2 years and 8 months, the total amount was Rs. 600. Find the rate of interest per annum.

  1. 5.3%

  2. 9.2%

  3. 10%

  4. 16%

  5. 16.32%
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Simple Interest = Amount - Principal = 600 - 525.75 = 74.25. Time = 2 years 8 months = 2 + 8/12 = 2 + 2/3 = 8/3 years. Rate = (SI * 100) / (P * T) = (74.25 * 100) / (525.75 * 8/3) = 7425 / 1402 = 5.296%, which is approximately 5.3%.

AI explanation

The simple interest earned is Rs. 600 minus Rs. 525.75, which equals Rs. 74.25, and the time is 2 years and 8 months, or 8/3 years. Using the formula Rate equals Interest multiplied by 100 divided by (Principal multiplied by Time), we get 74.25 multiplied by 100 divided by (525.75 multiplied by 8 divided by 3). This simplifies to 7425 divided by 1402, giving an annual rate of 5.3%.

Keep practicing — related questions