A sum lent at simple interest amounts to ₹6,313 in one year and ₹7,139 in 3 years. What is the rate of interest per annum?
Show answer & explanation
Correct answer: D
Explanation
The correct answer is option 4 i.e. 7%.
Amount in 3 years = ₹7,139
Amount in 1 year = ₹6,313
Interest for 2 years = 7139 − 6313 = ₹826
So, 1-year interest = 826 / 2 = ₹413
Principal = 6313 − 413 = ₹5,900
Rate = (Interest × 100) / (Principal × Time) = (413 × 100)/(5900 × 1) = 7%