Question

Which of the following yields maximum interest for 2 years?

(a) ₹1500 at 8% per annum
(b) ₹1000 at 11% per annum
(c) ₹2000 at 5% per annum
(d) ₹900 at 20% per annum

Answer 1

(a) It is given that,
Sum (P₁) = ₹1500
Rate (R₁) = 8%
Time (T₁) = 2 years

$$\begin{gathered} I_1=\frac{P_1\times R_1\times T_1}{100} \\ =\frac{1500\times 8\times 2}{100} \\ =240....\left(1\right) \end{gathered}$$

(b) It is given that,
Sum (P₂) = ₹1000
Rate (R₂) = 11%
Time (T₂) = 2 years

$$\begin{gathered} I_2=\frac{P_2\times R_2\times T_2}{100} \\ =\frac{1000\times 11\times 2}{100} \\ =220....\left(2\right) \end{gathered}$$

(c) It is given that,
Sum (P₃) = ₹2000
Rate (R₃) = 5%
Time (T₃) = 2 years

$$\begin{gathered} I_3=\frac{P_3\times R_3\times T_3}{100} \\ =\frac{2000\times 5\times 2}{100} \\ =200....\left(3\right) \end{gathered}$$

(d) It is given that,
Sum (P₄) = ₹900
Rate (R₄) = 20%
Time (T₄) = 2 years

$$\begin{gathered} I_4=\frac{P_4\times R_4\times T_4}{100} \\ =\frac{900\times 20\times 2}{100} \\ =360....\left(4\right) \end{gathered}$$

From (1), (2), (3) and (4),
₹900 at 20% per annum yields maximum interest for 2 years.
​
Hence, the correct option is (d).