+1 0 0 QUESTION 06 bookmark_border Select the correct answer An investment earns 4 paise/Re., if invested at the end of the year. If the interest earned by the investment is Rs. 100, then the investment is equal to radio_button_unchecked Rs. 2000 radio_button_unchecked Rs. 2200 radio_button_unchecked Rs. 1000 radio_button_unchecked Rs. 2500 radio_button_unchecked Rs. 4000
Question
+1 0 0 QUESTION 06 bookmark_border Select the correct answer An investment earns 4 paise/Re., if invested at the end of the year. If the interest earned by the investment is Rs. 100, then the investment is equal to
radio_button_unchecked Rs. 2000
radio_button_unchecked Rs. 2200
radio_button_unchecked Rs. 1000
radio_button_unchecked Rs. 2500
radio_button_unchecked Rs. 4000
Solution
To solve this problem, we need to understand that the interest rate is given as 4 paise per Rupee. This means that for every Rupee invested, the interest earned is 4 paise.
First, we need to convert the interest rate from paise to Rupees. There are 100 paise in a Rupee, so 4 paise is equal to 0.04 Rupees.
Next, we know that the interest earned is Rs. 100. The formula to calculate the principal amount (or the initial investment) when the interest earned and the interest rate are known is:
Principal = Interest / Interest Rate
Substituting the given values into the formula, we get:
Principal = 100 / 0.04 = Rs. 2500
So, the initial investment was Rs. 2500. Therefore, the correct answer is Rs. 2500.
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