Question : A sum amounts to INR 7,656 in 4 years and to INR 8,120 in 5 years at a certain simple interest rate percent per annum. The rate of interest is:
Option 1: 4%
Option 2: 3%
Option 3: 7%
Option 4: 8%
Correct Answer: 8%
Solution :
Given: A sum amounts to INR 7,656 in 4 years and to INR 8,120 in 5 years at a certain simple interest rate percent per annum.
Interest for 1 year = 8120 – 7656 = 464
$\therefore$ Interest for 4 years = 464 × 4 = 1856
So, principal = 7656 – 1856 = 5800
We know, Simple interest = $\frac{\text{Principal × Rate × Time}}{100}$
$⇒ 1856 =\frac{5800 × \text{Rate}×4}{100}$
$\therefore$ Rate $=8\%$
Hence, the correct answer is 8%.
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