Shortcut Trick
Total Simple Interest = Amount − Principal = ₹11,928 − ₹8,400 = ₹3,528
Simple Interest for 1 year = 7% of 8,400 = ₹588
Time = Total Interest ÷ Interest per year = 3528 ÷ 588 = 6 years
∴ The correct answer is 6 years.
Alternate Method
Given:
Principal (P) = ₹8,400
Amount (A) = ₹11,928
Rate (R) = 7% per annum
Formula Used:
Simple Interest (SI) = Amount − Principal
SI = (P × R × T) ÷ 100
Principal
₹8,400
- SI at 7% p.a.
T = ? years
Amount
₹11,928
SI = ₹11,928 − ₹8,400 = ₹3,528
Calculations:
⇒ SI = 11,928 − 8,400 = 3,528
⇒ 3,528 = (8,400 × 7 × T) ÷ 100
⇒ 3,528 = 84 × 7 × T
⇒ 3,528 = 588 × T
⇒ T = 3,528 ÷ 588
⇒ T = 6
∴ The correct answer is 6 years.
Additional Information
Compound Interest (CI) Formula
When interest is compounded annually, Amount = P × (1 + R/100)T. The CI is the difference between the Amount and the Principal.
Difference Between SI and CI for 2 Years
For a given principal P and rate R, the difference between CI and SI over 2 years is calculated as: D = P × (R/100)2.
Rule of 72
A quick rule of thumb used to estimate the number of years required to double the invested money at a given annual fixed interest rate. Time ≈ 72 ÷ R.