Question 11

A person borrows some money for 8 years at a rate of simple interest. If the ratio of principal and total interest is 5: 8, then what is the rate ( in percentage) of interest?

Solution

Let Principal amount = Rs. $$5x$$ and interest = Rs. $$8x$$

Let rate of interest = $$r\%$$ and time period = 8 years

=> Simple interest = $$\frac{P\times R\times T}{100}$$

=> $$\frac{5x\times r \times 8}{100}=8x$$

=> $$\frac{5r}{100}=1$$

=> $$r=\frac{100}{5}=20\%$$

=> Ans - (B)

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