Question

Find the sum that will amount to Rs. 10,000 in 5 years at 5% simple interest per annum?

1. Rs. 8,250
2. Rs. 8,500
3. Rs. 8,000
4. Rs. 8,750

Answer 1

Correct Answer - Option 3 : Rs. 8,000

Given:

Amount (A) = Rs. 10,000

Rate (R) = 5%

Time (T) = 5 years.

Formula Used:

A = P + S.I.

S.I. = (P × R × T)/100

Where,

A → Amount

S.I. → Simple Interest

P → Principal

R → Rate 

T → Time 

Calculations:

Let the principal be Rs. P.

According to the question,

S.I. = (P × 5 × 5)/100

⇒ S.I. = P/4

So, Amount = P + S.I.

⇒ 10000 = P + P/4 = 5P/4

⇒ P = Rs. 8,000

∴  The sum is Rs. 8,000.