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A sum of Rs. 22,400 amounts to Rs. 24,250 in 6 years at the rate of simple interest. What is the rate of interest (correct to two decimal places)?

A1.02%

B1.56%

C1.65%

D1.38%

Answer:

D. 1.38%

Read Explanation:

Solution:

Given:

Principal = Rs. 22,400

Time period = 6 years

Total amount (including interest) = Rs. 24,250

Formula:

S.I. =P×R100×T= P\times{\frac{R}{100}}\times{T}

Where, P = Principal, R = Rate of interest, and T = Time period (in years)

Calculation:

S.I. = Total amount - Principal 

⇒ 24,250 - 22,400 = Rs. 1850

According to the question,

1850=22,400×R100×61850 = 22,400\times{\frac{R}{100}}\times{6}

1850=224×R×61850 = 224\times{R}\times{6}

925=224×R×3925 = 224\times{R}\times{3}

R=925(224×3)R =\frac{925}{(224\times{3})}

R=925672R =\frac{925}{672} = 1.376 ≈ 1.38

∴ The rate of interest is 1.38%. 


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