₹8,500 becomes ₹11,050 in 6 years at a certain rate of simple interest. If the rate becomes 1.8 times of itself, the amount of the same principal in 5 years will be:
Show answer & explanation
Correct answer: D
Explanation
The correct answer is option 4 i.e. ₹12,325.
Simple Interest (SI) = 11050 - 8500 = 2550
SI = (P × R × T)/100
⇒ 2550 = (8500 × R × 6)/100 = 510R
⇒ R = 2550/510 = 5
New rate = 1.8 × 5 = 9%
SI = (8500 × 9 × 5)/100 = 3825
Amount = 8500 + 3825 = 12325
Therefore, the amount of the same principal in 5 years with the new rate will be ₹12,325.