A person lent a certain sum of money at 5% simple interest. If the interest after 6 years is ₹ 5, 600 less than the sum lent then what is the sum lent?
Show answer & explanation
Correct answer: D
Explanation
The correct answer is option 4 i.e. ₹ 8,000.
Given:
Principle - Simple interest = 5600
Rate = 5%
Time = 6 years
Formula used:
Simple interest = PRT/100 where ----- (1)
P = Principle, R = rate and T = time
Calculations:
According to the question;
Principle - Simple interest = 5600
⇒ P - PRT/100 = 5600
⇒ P(1 - (5 × 6)/100) = 5600
⇒ P(1 - 30/100) = 5600
⇒ P(1 - 3/10) = 5600
⇒ P(7/10) = 5600
⇒ P = 8000