Simple interest on a certain sum is one-fifth of the sum and the interest rate per cent per annum is 5 times the number of years. If the rate of interest increases by 3%, then how much will the simple interest (in ₹) be on ₹5,600 for 6 years?
Show answer & explanation
Correct answer: D
Explanation
The correct answer is Option 4 i.e. 4368.
Simple interest (SI) on the sum P(Principal) is one-fifth of P
⇒ S.I. = P/5
The rate of interest per annum R is 5 times the number of years T
⇒ R = 5T
Now,
⇒ S.I. = (P × R × T)/100
R = Rate, and T = Time
So,
⇒ P/5 = (P × 5T × T)/100
⇒ P/5 = 5PT2/100
⇒ 20P = 5PT2
⇒ 4 = T2
⇒ T = 2 years
Since R = 5T
⇒ R = 5 × 2 = 10%
The new rate of interest = 10 + 3 = 13%
Now,
⇒ S.I. = (5600 × 13 × 6)/100
⇒ 436800/100
⇒ 4368
Thus,
The simple interest will be ₹4,368