A sum of ₹12,400 amounts to ₹14,632 in 3 years at a rate of simple interest. What is the rate of interest per annum?

Correct option is A

Given:

Principal (P) = ₹12,400

Amount (A) = ₹14,632

Time (T) = 3 years

We need to find the rate of interest per annum (R).

Formula Used:
The formula for simple interest is:

A = P + SI

SI =$$\frac{P \times R \times T}{100}$$​

Where:

A is the amount after interest,

SI is the simple interest,

P is the principal,

R is the rate of interest per annum,

T is the time in years.

Solution:

The total amount after 3 years is ₹14,632, and the principal is ₹12,400. Therefore, the simple interest (SI) is:

SI = A - P = 14,632 - 12,400 = 2,232

Substitute the known values into the simple interest formula:

​$$2,232 = \frac{12,400 \times R \times 3}{100}$$​

​$$2,232 = \frac{37,200R}{100}$$​

223,200 = 37,200R

R =$$\frac{223,200}{37,200} = 6$$​

The rate of interest per annum is 6%.