Question

A sum of Rs. 900 amounts to Rs. 950 in 3 years at simple interest. If the interest rate is increased
by 4%, it would amount to how much?

Answer 1

Hence, the new total is 1038 rupees.

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Answer 2

Answer:

As per the given condition:

Sum(P) = Rs. 900 , Amount(A) = Rs. 950, T =3 years.

To calculate the interest;

Use:  Amount(A) = Principal(P) + Interest(I).

Interest (I)= A - P = 950-900 = Rs. 50.

Now, calculate the rate of interest (R);

Use Formula: $Simple Interest (I)=\frac{P \times R \times T}{100}$

where P is the Principal , R is the rate of interest (%) per annum and T is the time.

then;

$50 = \frac{900 \times R \times 3}{100}$ or

$50=9 \times R \times 3$

Simplify:

$R = \frac{50}{27} =\frac{50}{27}$%

If the interest rate is increased  by 4% then;

R'= $4+\frac{50}{27} = \frac{158}{27}$%

then;

$Interest(I') = \frac{P \times R' \times T}{100}$

⇒ $I' = \frac{900 \times\frac{158}{27} \times 3} {100}$ or

$I = 9 \times \frac{158}{27} \times 3 = 158$

⇒ $I = Rs. 158$

Amount(A') = P+I = 900+158 = Rs. 1058

Therefore, the amount become Rs. 1058