Question

A principal amount of ₹1,000 yields a simple interest of ₹180 over a period of 2 years. What is the annual rate of simple interest?

• A. 8%
• B. 9%
• C. 7%
• D. 6%

Answer 1

Answer:

B. 9%

Use the Simple Interest formula:

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

Where:

• (P = ₹1000)

• (SI = ₹180)

• (T = 2) years

• (R = ?)

Substitute the values:

$180=\frac{1000 \times R \times 2}{100}$
180=20R

$R=\frac{180}{20}=9$

Answer: $(\boxed{9\% \text{ per annum}})$