Question : Suman paid INR 9,600 in interest on a loan she obtained 5 years ago with a simple interest rate of 16%. What was the amount of the loan she had taken?
Option 1: INR 13,250
Option 2: INR 12,500
Option 3: INR 12,000
Option 4: INR 11,750
Correct Answer: INR 12,000
Solution :
Let the principal be $\text{x}$.
We know, Simple interest = $\frac{\text{Principal × Rate × Time}}{100}$
⇒ $9600=\frac{\text{x × 16 × 5}}{100}$
⇒ $\text{x}=\frac{\text{9600 × 100}}{\text{16 × 5}}$
⇒ $\text{x}=12000$
Hence, the correct answer is INR 12000.
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