A sum of Rs.2000 gives a simple interest of Rs.100 in 2 years. Find the rate of interest per annum ?
Question
A sum of Rs.2000 gives a simple interest of Rs.100 in 2 years. Find the rate of interest per annum ?
Solution
To find the rate of interest per annum, we can use the formula for simple interest which is:
I = PRT/100
where: I = Interest P = Principal amount (the initial amount of money) R = Rate of interest T = Time (in years)
In this case, we know that: I = Rs.100 P = Rs.2000 T = 2 years
We need to find R. So, we rearrange the formula to solve for R:
R = I * 100 / (P * T)
Substituting the given values:
R = 100 * 100 / (2000 * 2)
R = 10000 / 4000
R = 2.5
So, the rate of interest per annum is 2.5%.
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