What sum of money, when lent at 6% interest for 4 years, will earn interest equal to the interest on ₹800 at % in 5 years?
Show answer & explanation
Correct answer: D
Explanation
The correct answer is option 4 i.e. ₹750.
Rate1 = 6%, Time1 = 4 years, Principal = P (unknown)
Rate2 = 4.5%, Time2 = 5 years, Principal = 800
Simple Interest (SI) for both cases is equal:
SI₁ = SI₂
(P × 6 × 4) / 100 = (800 × 4.5 × 5) / 100
(24P) / 100 = (18000) / 100
24P = 18000
P = 18000 ÷ 24 = 750