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A sum of 5000 is invested in which the investor gets 800 as simple interest at the rate of 4 percent per annum. To get an interest of 2000 rupees on the same sum in the same number of years, what will be the rate of interest?

Question

A sum of 5000 is invested in which the investor gets 800 as simple interest at the rate of 4 percent per annum. To get an interest of 2000 rupees on the same sum in the same number of years, what will be the rate of interest?

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Solution

To solve this problem, we first need to understand the formula for simple interest, which is I = PRT/100, where:

  • I is the interest
  • P is the principal amount (the initial amount of money)
  • R is the rate of interest
  • T is the time (in years)

From the problem, we know that an interest of 800 is earned from a principal of 5000 at a rate of 4% per annum. We can use this information to find the time period.

Substituting the given values into the formula, we get:

800 = (5000 * 4 * T) / 100 => T = (800 * 100) / (5000 * 4) => T = 4 years

Now, we want to find the rate of interest that would yield an interest of 2000 for the same principal and time period. We can substitute these values into the formula and solve for R:

2000 = (5000 * R * 4) / 100 => R = (2000 * 100) / (5000 * 4) => R = 10%

So, the rate of interest required to get an interest of 2000 rupees on the same sum in the same number of years is 10%.

This problem has been solved

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