Damani purchased an item costing ₹7,500 and paid ₹3,500 as a down payment for thesame. If the simple interest charged for the remaining amount is 9% per annum and Damani cleared all dues after 4 months of the purchase, how much did Damani pay after 4 months as interest ?
Show answer & explanation
Correct answer: A
Explanation
The correct answer is option 1 i.e. ₹120
Formula used:
Simple interest = PRT/100
where, P = principle, R = rate and T = time
Calculations:
Remaining amount after downpayment = 7500 - 3500 = 4000
Rate for 1 year = 9%
Rate of 4 month = 3%
Hence, interest after 4 months = 4000 × 3% = 120