Question

A man invested 4000 in a bank at simple interest rate if the number of year increased by 3 years then the interest increased by 360 find the rate ?.

• A. 2%
• B. 4%
• C. 3%
• D. 6%

Answer 1

Answer:

C. 3%

Simple Interest Concepts for Competitive Exams

• Simple Interest (SI): Calculated only on the principal amount. The formula is SI = (P × R × T) / 100, where P is Principal, R is Rate of interest per annum, and T is Time in years.

• Key Principle: In simple interest, the interest earned each year is constant.

Problem Analysis and Solution Approach

• Given:

  • Principal (P) = 4000

  • Increase in Time = 3 years

  • Increase in Interest = 360

• Understanding the Change: The additional interest of 360 is earned solely due to the extra 3 years at the same rate.

• Calculating the Interest for the Extra Period: The 360 increase in interest corresponds to the simple interest earned over these additional 3 years.

• Finding the Annual Interest:

  • Interest per year = Increase in Interest / Increase in Time

  • Interest per year = 360 / 3 = 120

• Relating Annual Interest to Rate: The annual interest is calculated on the principal amount at the given rate.

• Calculating the Rate (R):

  • We know that Annual Interest = (P × R × 1) / 100

  • 120 = (4000 × R × 1) / 100

  • 120 = 40 × R

  • R = 120 / 40

  • R = 3%