A sum was invested on simple interest at a certain rate for 3 years. Had it been put at 5% higher rate, it would have fetched Rs. 270 more interest. The sum invested was:
- AOption (a)
Rs. 2,000
- BOption (b)
Rs. 1,500
- COption (c)
Rs. 1,800
- DOption (d)
Rs. 1,700
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Correct answer
Rs. 1,800
Why this answer is correct
Given:
Simple interest rate for 3 years.
Interest difference if rate is 5% higher = Rs. 270. Formula Used:
Simple Interest (SI) = (Principal × Rate × Time) / 100
Calculation:
Let the principal be P.
Rate difference = 5%
Time = 3 years
Interest difference = Rs. 270
Using the formula for simple interest:
⇒ (P × 5 × 3) / 100 = 270
⇒ P × 15 / 100 = 270
⇒ P × 0.15 = 270
⇒ P = 270 / 0.15
⇒ P = 1800
The sum invested was Rs. 1800.