Question 73

What sum of money should be invested to earn a simple interest of ₹5,040 in 3 years and 6 months at 12% rate of interest per annum?

Solution

Let's assume the sum of money for investment is 'P'.

rate of interest = R = 12%

Time = T = 3 years and 6 months

= 3.5 years [1 year = 12 months, then 0.5 year = 6 months]

Simple interest = SI = 5,040

$$SI=\frac{P\times\ R\times\ T}{100}$$

$$5040=\frac{P\times12\times3.5}{100}$$

$$5040=\frac{42P}{100}$$

42P = 504000

P = 12000

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