Anil lent a sum of Rs 5,000 on simple interest for 10 years in such a way that the rate of interest is 6% per annum for the first 2 years, 8% per annum for the next 2 years and 10% per annum beyond 4 years. How much interest (in Rs) will he earn at the end of 10 years?
Show answer & explanation
Correct answer: B
Explanation
The correct answer is option 2 i.e. 4400
Formula used:
Simple interest = PRT/100
P = principal, R = rate and T = Time period
Calculations:
Simple interest (10 years) = 6% for 2 years + 8% for next 2 years + 10 years for next 6 years
⇒ 6 × 2 + 8 × 2 + 10 × 6 = 88%
Now according to the question;
Interest (in Rs) he will earn at the end of 10 years ⇒ 88% of 5000 = 4400