Question

Leo invests a sum of ₹ 1,000 in a magic fund giving 50 % p.a rate of interest.Find the interest earned by him at the end of 10 years.

• A. ₹ 5,000
• B. ₹ 4,000
• C. ₹ 3,000
• D. ₹ 5,000

Answer 1

The correct option is A ₹ 5,000

Given, time = 10 years.
The sum invested = ₹ 1,000.
Rate of interest = 50 % 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, Interest earned = $\frac{1,000\times 50\times 10}{100}=₹5,000$

So, the interest earned after 10 years = ₹ 5,000.