Rs. 480 is invested at simple interest. It becomes Rs. 520 after 20 months. What is the interest rate per annum?
Show answer & explanation
Correct answer: B
Explanation
Correct Answer is option 2 i.e. 5%
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Understanding |
Application |
Calculation |
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P = Rs. 480 A = Rs. 520 T = 20 months = 20/12 = 5/3 years |
Simple interest = Rs. 40
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⇒ 520 – 480 = 40 |
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Formula: SI = (PRT/100) |
Using the formula: ⇒ R = 5% |
40 = (480 × R × 5/3)/100 ⇒ 40 = 8R ⇒ R = 5 |