A specific amount of principal is invested by an individual. The annual simple interest rate is 6% for the first two years, 8% for the following four, and 10% for the remaining time. The total interest earned after nine years is ₹7,400. How much was invested initially?
Show answer & explanation
Correct answer: C
Explanation
Given:
Rate for the first two years = 6%
Rate for the next four years = 8%
Rate for the remaining three years = 10%
Total interest = 7400
By the formula:
SI = (P × R × T) / 100
Interest for the first two years = P × 6 × 2 / 100 = 0.12P
Interest for the next four years = P × 8 × 4 / 100 = 0.32P
Interest for the next three years = P × 10 × 3 / 100 = 0.30P
Total interest = 0.12P + 0.32P + 0.30P = 0.74P
0.74P = 7400
P = 10,000
Initial investment = ₹10,000