Correct Answer - Option 1 : Rs. 2860
Given:
P = Rs. 6500
R = 20%
N = 2
Formula used:
A = P × (1 + (R/ 100))N
A = P + I
Where, P = Principal amount, R = Rate of interest, N = number of years and I = Simple interest
Calculation:
A = 6500 × (1 + (20/ 100))2
⇒ A = 6500 × 6 × 6/ 25
⇒ A = 260 × 36
⇒ A = 9360
A = P + I
⇒ I = 9360 – 6500
⇒ I = 2860
∴ I = Rs. 2860