Question

If principal = Rs 5000, period = 4 years and simple interest = Rs 1600, what is the rate of simple interest?

Answer 1

Principal (P) = Rs 5000
Time (N) = 4 years
Interest = I = Rs 1600
We have $\mathrm{I}=\frac{\mathrm{P}\times \mathrm{R}\times \mathrm{N}}{100}$
$$\begin{gathered} \Rightarrow 1600=\frac{5000\times \mathrm{R}\times 4}{100} \\ \Rightarrow 1600=50\times \mathrm{R}\times 4 \end{gathered}$$

On dividing both the sides by 50, we obtain:
$$\begin{gathered} \frac{1600}{50}=\frac{50\times \mathrm{R}\times 4}{50} \\ \Rightarrow 32=\mathrm{R}\times 4 \end{gathered}$$
On dividing both the sides by 4, we obtain:
$$\begin{gathered} \frac{32}{4}=\frac{\mathrm{R}\times 4}{4} \\ \Rightarrow 8=\mathrm{R} \end{gathered}$$
∴ R = 8%