Question

Ram deposited 10,000 in a bank. After 2 years he withdraws 4,000 and at the end of 5 years he receives an amount of 7,520. Find the rate of simple interest.

Answer 1

The rate of simple interest was 4%

Step-by-step explanation:

Ram deposited a Principal of Rs 10000

Let r be the rate of SI,

So, for 2 years, he earned an interest of

SI = p*r*n/100

= 1000 * r * 2/100

     = 200r

After 2 years, he withdrew 4000

So the amount in the bank = 10000-4000 = 6000

After 5 years, he got an amount of Rs 7520

So the amount of interest he earned = 7520 – 6000 = 1520

For the remaining 3 years, he earned an interest of  

SI = p*r*n/100

SI = 6000 * r * 3/100

= 180r

The total interest he received is Rs 1520

Thus;

1520 = SI after 2 years + SI after 3 years

        = 200 r+ 180r

1520 = 380 r

     4 = r

Thus, the rate of Simple interest was 4%