How long (in years) will it take for ₹1,440 to become ₹2,700 at a rate of 10% per annum simple interest?
- AOption (a)
8.75
- BOption (b)
9.75
- COption (c)
7.75
- DOption (d)
10.75
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Correct answer
8.75
Why this answer is correct
Shortcut Trick
Total Simple Interest generated = Amount − Principal = 2700 − 1440 = ₹1260.
Interest for 1 year = 10% of 1440 = ₹144.
Time taken = Total Interest ÷ Interest per year = 1260 ÷ 144.
Time = 35 ÷ 4 = 8.75 years.
∴ The correct answer is 8.75 years.
Alternate Method
Given:
Principal (P) = ₹1,440
Amount (A) = ₹2,700
Rate of Interest (R) = 10% per annum
Formula Used:
Simple Interest (SI) = Amount − Principal
SI = (P × R × T) ÷ 100
Principal ₹1440
Amount ₹2700
- ₹1260 (SI) Rate = 10% p.a.
Time (T) = ?
Calculations:
⇒ SI = 2,700 − 1,440 = ₹1,260
⇒ 1,260 = (1,440 × 10 × T) ÷ 100
⇒ 1,260 = 144 × T
⇒ T = 1,260 ÷ 144
⇒ T = 105 ÷ 12
⇒ T = 35 ÷ 4
⇒ T = 8.75
∴ The correct answer is 8.75 years.
Additional Information
Simple Interest (SI)
It is the interest calculated only on the initial principal amount. Formula: SI = (P × R × T) ÷ 100.
Amount in Simple Interest
The total amount paid or received at the end of the time period. Formula: A = P + SI = P × [1 + (R × T) ÷ 100].
Compound Interest (CI)
Interest calculated on both the principal and the accumulated interest of previous periods. Formula: A = P × (1 + R ÷ 100)T.
