Correct Answer - Option 1 : 570
Given:
Rs. 840 in 3 years and Rs. 1200 in 7 years.
Amount in 3 years becomes Rs. 840 and Amount in 7 years become Rs. 1200
Formula used:
Principal = Amount - Simple Interest
Calculation:
The difference of amounts 7 years and 3 years gives a simple interest for 3 years.
Difference of amounts = 1200 - 840 = 360
∴ In 1 year simple interest = 360/4 = 90
In 3 years simple interest = 90 × 3 = 270
Principal = Amount in 3 years - Simple Interest in 3 years
⇒ Principal = 840 - 270 = 570
∴ The value of principal is Rs. 570.
