Question : If Rs. 8,500 becomes Rs. 11,050 in 6 years at a certain rate of simple interest, and the rate then becomes 1.8 times higher, what will be the amount after 5 years on the same principal?
Option 1: Rs. 15,625
Option 2: Rs. 14,350
Option 3: Rs. 13,550
Option 4: Rs. 12,325
Correct Answer: Rs. 12,325
Solution :
Given:
Principal amount = Rs. 8,500
Time = 6 years
Simple interest = 11,050 – 8,500 = 2,550
Let the rate be
Now,
⇒
⇒
Now if the rate becomes 1.8 times itself, the amount of the same principal in 5 years will be:
=
=
=
=
Hence, the correct answer is Rs. 12,325.
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