Correct Answer - Option 1 : 25,080
Given:
A sum invested at 10% per annum amounts to Rs. 20,947.50 in one year, interest is compounded half-yearly
Formula used:
Simple Interest = (P × r × t)/100
Compound interest
⇒ A = P × {1 + (r/100)}t
Where P = Principal
A = Amount
r = Rate of Interest
t = Time
Calculation:
The rate of interest is 10% per annum
But the interest is compounded half-yearly
So, rate of interest will become 10/2 = 5%
⇒ 20947.50 = P × {1 + (5/100)}2
⇒ 20947.50 = P × (21/20)2
⇒ P = 20947.50 × (20/21)2
⇒ P = 19000
According to the question, the rate of interest is tripled.
⇒ r = 10 × 3 = 30%
The simple interest for 22/5 years is
⇒ {19000 × 30 × (22/5)}/100
⇒ (19000 × 6 × 22)/100
⇒ 2508000/100 = Rs. 25080
∴ The simple interest for \(4\frac{2}{5}\) is Rs. 25080.