Multiple choice

A sum of Rs. 9000 becomes Rs. 10800 in 10 years at simple interest. Find the rate of interest per annum.

  1. 2%

  2. 3%

  3. 2.5%

  4. 1.67%
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A Correct answer
Explanation

Simple Interest = 10800 - 9000 = 1800. Time = 10 years. Principal = 9000. Rate = (1800 * 100) / (9000 * 10) = 2%.

AI explanation

The simple interest earned is the difference between the final amount and the principal, which is 10800 minus 9000, equaling Rs. 1800. Using the simple interest formula, the rate equals the interest multiplied by 100, divided by the product of the principal and the time. Substituting the given values, the rate equals 1800 multiplied by 100, divided by the product of 9000 and 10. This simplifies to 180000 divided by 90000, resulting in a rate of 2% per annum.

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