Question : A principal of Rs. 16000 is invested at simple interest for 4 years. If the per annum rate of interest is 20 percent, then what will be the amount after 4 years?
Option 1: Rs. 23480
Option 2: Rs. 28800
Option 3: Rs. 26480
Option 4: Rs. 30420
Correct Answer: Rs. 28800
Solution :
Given: A principal of Rs. 16000 is invested at simple interest for 4 years. If the per annum rate of interest is 20 percent.
We know, Simple interest = $\frac{\text{Principal × Rate × Time}}{100}$
According to the question,
$\therefore$ Simple interest $=\frac{16000\times 4\times 20}{100}=$ Rs. 12800
Amount = Principal + Simple interest = 16000 + 12800 = Rs. 28800
Hence, the correct answer is Rs. 28800.
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