If the ratio of principal and simple interest for 5 years is 10 : 7, then the rate of interest per annum is:
Show answer & explanation
Correct answer: C
Explanation
The correct answer is option 3 i.e. 14%.
P/SI = 10/7
⇒ SI = (7/10)P
SI = (P × R × T)/100
⇒ (7/10)P = (P × R × 5)/100
⇒ 7/10 = 5R/100
⇒ 5R = 70
⇒ R = 70/5 = 14
Hence, the rate of interest per annum is 14%.