A sum, when invested at 10% simple interest per annum, amounts to ₹2640 after 2 years. What is the simple interest (in ₹) on the same sum at the same rate of interest in 1 year?

Correct option is A

Given:

Amount after 2 years = ₹2640

Rate of interest = 10%

Time = 2 years

Formula Used:

Simple Interest (SI) = $$\frac{P \times R \times T}{100}$$​​

Where P is the principal, R is the rate and T is the time.

Principal = Amount - SI (rearranged as needed)

Solution:
Let the principal be P

SI for 2 years = $$\frac{P \times 10 \times 2}{100}$$​​

​$$= \frac{P \times 20}{100}$$​​

​$$= \frac{P}{5}$$​​

Amount = P + $$\frac{P}{5}$$​​

​$$\frac{6P}{5} = 2640$$​​

P = $$\frac{2640 \times 5}{6}$$​ = ₹2200

Now, SI for 1 year:

SI =$$\frac{2200 \times 10 \times 1}{100}$$​ = ₹220