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A sum of money amounts to ₹850 in 3 years and to ₹925 in 4 years at some rate of simple interest. The sum is :
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- ₹550
- ₹600
- ₹625
- ₹700
- ₹550
Correct Option: C
Interest for 1 year = Amount - Principle = ₹ (925 – 850) = ₹ 75
∴ If a sum becomes a1 in t1 years and a2 in t2 years then
| Rate of interest = | % | |
| (a1t2 - a2t1) |
| R = | |
| 850 × 4 - 3 × 925 |
| R = | = 12% | 625 |
| ∴ Principal = | |
| Time × Rate |
| Principal = | = ₹ 625 | |
| 1 × 12 |
Second method to solve this question :
Here , A2 = ₹ 925 , T1 = 3 years , A1 = ₹ 850 , T2 = 4 years
| P = |  |  | |
| T1 - T2 |
| P = | |
| 3 - 4 |
| P = | |
| - 1 |
| = | |
| - 1 |
P = ₹ 625
