Question

If the Simple interest earned on a sum of ₹ 20,000 from a bank in a period of 2 years is ₹ 4,000. Find the rate of interest (in percentage).

• A. 10

Answer 1

The correct option is A 10
Given, time = 2 years.
The sum invested = ₹ 20,000.
Let the interest charged be R % p.a.

The Simple Interest earned on a sum of ₹ P for a period of T years at the rate of R% p.a S.I is given by $\frac{P\times R\times T}{100}$.

So, ₹ 4,000 = $\frac{20,000\times R\times 2}{100}$

Hence, the rate of interest = 10 % p.a.