In what time will ₹10,000 at 4% per annum, produce the same interest as ₹8,000 does in 4 years at 5% simple interest?
Show answer & explanation
Correct answer: C
Explanation
The correct answer is Option 3 i.e 4 years.
S.I. = (P × R × T)/100
where, S.I. = simple interest, P = Principal, T = Time, and R = rate
Interest earned on Rs.8000
⇒ S.I. = (8000 × 5 × 4)/100
⇒ S.I. = Rs.1600
Now, according to the question
Let, the interest earned in time T
⇒ 1600 = (10000 × 4 × T)/100
⇒ 1600 × 100 = 40000 × T
⇒ T = 4 years