Correct Answer - Option 1 : 5%
Given:
Rs. 600 become Rs. 720 in 4 years
Concept Used:
Interest = Amount - Principal
If the principal is p, time is t and the rate of interest is r then the simple interest is ptr/100
Calculation:
Rs. 600 become Rs. 720 in 4 years that means
Principal (p) = 600
Amount (A) = 720
Time (t) = 4 year
Let, the rate of interest be r%
Total interest = 720 - 600
⇒ 120
(600 × 4 × r)\100 = 120
⇒ 24r = 120
⇒ r = 5
∴ The rate of simple interest per annum is 5%
