Question

M borrowed some money for 1 year at certain simple interest. But the interest rate was increased to 2% which amounted to Rs. 120. Find the principal amount?.

• A. Rs.4000
• B. Rs.5000
• C. Rs.6000
• D. Rs.7000

Answer 1

Answer:

C. Rs.6000

Given:

An increase in interest rate amounts to Rs 120

 Concept used:

$SI=\frac{Prt}{100}$

Calculation:

When the interest increased, an extra Rs 120 was added to the interest.

That is, the 2% increase in interest = Rs 120

$⇒120=\frac{(P\times{2}\times{1})}{100}$

$⇒P=\frac{12000}{2}$

⇒ P = 6000

The sum is Rs. 6000.

∴ The principal is Rs 6000.