Multiple choice

A sum of money amounts to ₹7,200 in 2 years and ₹9,000 in 3 years under continuous Simple Interest. What is the principal sum?

  1. ₹3,600

  2. ₹4,000

  3. ₹4,200

  4. ₹4,500

  5. ₹3,800
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A Correct answer
Explanation

Under simple interest, the amount increases by 9,000 - 7,200 = 1,800 in one year. Thus the simple interest for two years is 3,600, and the principal is 7,200 - 3,600 = 3,600.

AI explanation

Under the Simple Interest method, the interest earned each year is the difference between the amounts at the end of consecutive years. The interest for one year is 9,000 minus 7,200, which equals 1,800, meaning the interest for 2 years is 3,600. Subtracting this 2-year interest from the amount at 2 years gives the principal: 7,200 minus 3,600 equals 3,600.

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