Correct Answer - Option 2 : Rs. 11,000
Given
Amount = Rs. 13,200
Time = 4 years
Rate = 5% per an um
Formula used
Simple interest = (p × r × t)/100
Where p, r and t are principal, rate and time respectively.
Simple interest = Amount - Principal
Calculation
Let the principal is Rs. x
Simple interest = 13,200 - x
13,200 - x = (x × 5 × 4)/100
⇒ 1320000 - 100x = 20x
⇒ 1320000 = 120x
⇒ x = 1320000/120
⇒ x = Rs. 11,000
∴ Rs. 11,000 is a sum borrowed by Mr Peter.