Question

If the simple interest (SI) for 10 years is 1 / 5 of the principal. Then what will be the SI of Rs 5000 with the same rate of interest for 5 years?

• A. 500
• B. 50
• C. 550
• D. 150

Answer 1

Answer:

A. 500

Solution:

Given:

Simple interest (SI) for 10 yr is 1/5 of the principal.

Have to find SI for 5 years of Rs 5000 with the same rate of interest.

Formula used:

Simple Interest (SI) =  [Principal (P) ×  Rate of interest (R)  × Time(T)] / 100

Calculation:

As per the question:

In 1st case,  let Principal = P,

Then SI = P / 5 , T = 10 years, 

As per the formula,

$\frac{P}{5}$ = (P × R × 10) / 100

⇒ (1 / 5 ) = R / 10

⇒ R = 2 %

So, the rate of interest is 2 %.

In the 2nd case,

R is same = 2 %, P = 5000 and T = 5 years

So, SI = (5000 × 2 × 5) / 100

⇒ SI = 50000 / 100

⇒ SI = Rs 500

∴ The Simple Interest (SI) is Rs 500.