Question

A sum of money becomes 8/5 of itself in 5 years at a certain rate of simple interest Find the rate of interest ​

Answer 1

Answer:

Rate of interest = 12 per cent per year

Step-by-step explanation:

Simple interest

P = principal = initial amount

R = rate of interest per cent per year

T = number of years

SI = Simple interest = (P*R*T)/100

A = final amount at the end of T years = P + SI

We are given:

P = initial amount

A = (8/5)*P

T = 5 years

R = ?

SI = (P*R*T)/100

∴ SI = (P*R*5)/100

A = P + SI

∴ (8/5)*P = P + (P*R*5)/100

∴ 8P/5 = P(1 + 5R/100)

∴ 8/5 = (1 + 5R/100)

∴ (1 + 5R/100) = 8/5

∴ 5R/100 = 8/5 - 1

∴ 5R/100 = 3/5

∴ 25R = 300

∴ R = 12

Rate of interest = 12 per cent per year

Answer 2

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