Correct Answer - Option 1 : 2%
Given:
The simple interest on a sum of money is 1/25 of the principal
Calculation:
Let principal be P.
Time be T and Rate = T
∴ According to the question:
⇒ P × T × T/100 = P/25
⇒ T2 = 100/25
⇒ T = 10/5
⇒ T = 2%
∴ the rate percent is 2%.