Akshay invests a sum of ₹5400 and Atul invests a sum of ₹9400 at the same rate of simple interest per annum. If, at the end of 4 years, Atul gets ₹720 more interest than Akshay, then find the rate of interest per annum (in percentage).
Show answer & explanation
Correct answer: B
Explanation
The correct answer is option 2 i.e. 4.5.
Akshay’s principal (P1) = ₹5400
Atul’s principal (P2) = ₹9400
Time (T) = 4 years
Difference in interest = ₹720
Simple Interest formula: SI = (P × R × T) / 100
Interest of Akshay = (5400 × R × 4) / 100 = 216R
Interest of Atul = (9400 × R × 4) / 100 = 376R
Difference = 376R - 216R = 160R = 720
⇒ R = 720 ÷ 160 = 4.5%