Multiple choice

Mohan wants to have Rs. 1,00,000 in his savings account after 5 years. The bank offers 5% simple interest per annum. How much should Mohan invest today?

  1. Rs. 76,000

  2. Rs. 78,000

  3. Rs. 80,000

  4. Rs. 82,000

  5. Rs. 84,000
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Let P be the principal. Amount = P + (P * R * T / 100). 100,000 = P + (P * 5 * 5 / 100) = P + 0.25P = 1.25P. P = 100,000 / 1.25 = 80,000.

AI explanation

Let the principal be P; the amount formula for simple interest is A = P + (P * R * T) / 100. Substituting the known values gives 100000 = P + (P * 5 * 5) / 100, which simplifies to 100000 = 1.25P. Solving for P yields 100000 / 1.25, meaning he should invest Rs. 80,000.

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