Question

What sum of money should be invested for 5 years at 8% per annum to on the same interest as rupees 3600 at 10% per annum for 4 years

Answer 1

Simple Interest = SI = P x R x T /100

For the first case:

Principle Amount = P = Rs. 3600

Rate of Interest = R = 10%

Time = T = 4 years.

Simple Interest = SI = ?

So:

SI = P x R x T /100

SI = 3600x10x4/100

SI = Rs.1440.

So the Simple Interest of the first case will be the Sinple Interest of the second case.

Then:

Principle Amount = P = ?

Rate of Interest = R = 8%

Time = T = 5 years

SI = Rs. 1440

So:

SI = P x R x T /100

1440 = Px8x5/100

40P = 144000

P = 144000/40 = Rs. 3600.

Ans: Rs. 3600.