Ram invested a certain sum of money at simple interest. It amounted to (5/4) of itself in 3 years. What will be its rate per cent per annum?

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Question

This question was previously asked in

SSC CHSL Exam 2024 Tier-I Official Paper (Held On: 08 Jul, 2024 Shift 4)

Answer 1

Given:

Ram invested a certain sum of money at simple interest.

It amounted to 5/4 of itself in 3 years.

Formula Used:

Simple Interest (SI) = Principal (P) × Rate (R) × Time (T) / 100

Amount (A) = Principal (P) + Simple Interest (SI)

Calculation:

Let the Principal be P.

Amount after 3 years = \(\frac{5}{4}\) × P

Simple Interest (SI) = Amount - Principal = \(\frac{5}{4}P - P\)

SI = \(\frac{P}{4}\)

We know:

SI = P × R × 3 / 100

⇒ \(\frac{P}{4}\) = P × R × 3 / 100

⇒ \(\frac{1}{4}\) = R × 3 / 100

⇒ \(\frac{100}{4}\) = 3R

⇒ 25 = 3R

⇒ R = \(\frac{25}{3}\)

⇒ R = 8.333

The rate per cent per annum is 8.33%.

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