Question

The simple interest on rs. 800 when invested at a certain rate of interest p. a. for 4 years is equal to that on rs.625 when invested for 8 years at a rate of 4% p. a. find the rate of interest p. a. in the first case?​

Answer 1

The rate of interest in the first case is 6.25%

i) Principal amount of case1 and case2 are rs. 800 and rs. 625 respectively.

ii) Rate of interest in case1 be r and in case2 is 4%.

iii) Time period of case1 and case2 is 4years and 8 years respectively.

iv) Formula of simple interest = (principal amount × rate of interest × time period) /100

v) According to the question:

simple interest of case1 = simple

interest of case2

(800×r×4) /100 = (625×4×8) /100

Solving above equation we get ;

r = 6.25%(Required Answer)