Question

Find the simple interest rate at which a sum of money becomes five times at simple interest in 10 years.

A. 40%

B. 35%

C. 25%

D. 50%

1. B
2. D
3. A
4. C

Answer 1

Correct Answer - Option 3 : A

Given:

Time period = 10 years

Formula used:

\(\rm S.I = \frac{{{\rm{P\;}} × {\rm{\;t\;}} × {\rm{\;r}}}}{100}\)

P = principal

t = Time period

r = Rate of interest

Calculation:

Let P be Rs. x

According to the question,

According to the question money becomes 5x

So, interest = 5x – x = 4x

\(\rm 4x = \frac{{{\rm{x\;}} × {\rm{\;10\;}} × {\rm{\;r}}}}{100}\)

⇒ 400x = 10xr

⇒ 40 = r

⇒ Rate of interest = 40%

∴ Required rate of interest is 40%