Question

Yukta invested some amount in State bank of India for 4 years at 10% simple interest per annum and earned a total interest of Rs.5420, then find the invested amount.
1. Rs.13550
2. Rs. 13000
3. Rs. 12500
4. Rs. 12850

Answer 1

Correct Answer - Option 1 : Rs.13550

Given:

Simple interest = Rs. 5420

Time (T) = 4 years

Rate (R) = 10%

Concept:

Simple interest is the interest calculated on the principal portion of the loan or the original contribution to the saving account.

Formula Used:

Simple Interest = (P × R × T)/100

Where, P = Principal, R = Rate, T = Time

Calculation: 

Let the principal be 'P' 

Simple Interest = (P × R × T)/100

⇒ 5420 = (P × 10 × 4)/(100)

⇒ 5420 = 40P/100

⇒ P = 542000/40

⇒ P = Rs. 13550

∴ The principal or the amount Yukta borrowed from the bank is Rs. 13550.