Question

In 4 years the simple interest on a certain sum of money is 7/25 pf the principal. The annual rate of interest is

Answer 1

7 percent is the rate

Answer 2

The annual rate of interest is 7 %

Solution:

Given that,

Time period = 4 years

Let "p" be the principal

Given that,

The simple interest on a certain sum of money is 7/25 of the principal

Therefore,

$S.I = \frac{7}{25} \times p$

The simple interest is given by:

$S.I = \frac{p \times n \times r}{100}$

Where,

p is principal

n is number of years

r is rate of interest per annum

Substituting the values,

$\frac{7}{25} \times p = \frac{p \times 4 \times r}{100}\\\\\frac{7}{25} \times \frac{100}{4} = r\\\\r = 7$

Thus, annual rate of interest is 7 %

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