Question

What would be the interest payable on a deposit of Rs. 1,500 invested for four years at 8% simple interest per annum?
1. Rs. 500
2. Rs. 480
3. Rs. 520
4. Rs. 475

Answer 1

Correct Answer - Option 2 : Rs. 480

Given:

Principal = Rs. 1500

Rate of interest = 8%

Time period = 4 years

Formula used:

I = (P × t × r)/100

I = Interest

P = Principal

t = Time period

r = Rate of interest

Calculation:

According to the question,

I = (1500 × 4 × 8)/100

⇒ I = 15 × 4 × 8

⇒ I = Rs. 480

∴ The interest payable on the deposit is Rs. 480.