The sum of ₹500 becomes ₹600 in 2 years at certain rate of simple interest. If the rate of interest is halved, then what amount will ₹500 give in 2 years?

Sum of 500 becomes 600 in 2 years

therefore simple interest = 600 - 500 = 100

Formula for simple interest (SI)

I = $$ \frac{PNR}{100} $$

P = principle amount = 500

N = time period = 2 years

R = rate of interest

I = simple interest = 100

Substituting,

$$ 100 = \frac{500 \times 2 \times R}{100} $$

solving  R = 10%

If the rate of interest is halved then R =5%

$$ I = \frac{500 \times 2 \times 5}{100} $$

I = 50

Amount = Principle + Interest

            = 500 + 50

            = 550