Question

A certain sum of money amounts to rs. 2,500 in a span of 5 years and further to rs. 3,000 in a span of 7 years at simple interest. the sum is

Answer 1

2500 in 5th year and 3000 in 7th year
 
So in between 2 years Rs. 500 is increased => for a year 500/2 = 250

So, per year it is increasing Rs.250

then in 5 years => 250 x 5 = 1250

Hence, the initial amount must be 2500 - 1250 = Rs. 1250

Answer 2

The simple interest formula is given by :

Simple interest = Principle  × rate/100 × time

In simple interest the interest does not earn interest hence the amount increases by a constant amount every time.

From this information we can comfortably answer this question.

Between year 5 and year 7 the amount increases by :

3000 - 2500 = 500

This is in a span of 2 years.

The annual interest is given by:

Annual interest = 500/2 = rs 250  

For 5 years the interest earned equals to :

250 × 5 = 1250.

The amount is thus :

2500 - 1250 = 1250

The amount is thus :

Rs 1250