Question : Simple interest received by a person in 12 years on a principal of INR 12000 is 120% of the principal. What is the annual rate of interest?
Option 1: 20%
Option 2: 12%
Option 3: 10%
Option 4: 5%

Question

Question : Simple interest received by a person in 12 years on a principal of INR 12000 is 120% of the principal. What is the annual rate of interest?

Option 1: 20%

Option 2: 12%

Option 3: 10%

Option 4: 5%

Team Careers360 · Accepted Answer

Correct Answer: 10%

Solution : Principal, $P$ = INR 12000
Term, $n$ = 12 years
Simple interest, SI = 120% × $P$ = $\frac{120P}{100}$
Let $R$ be the rate of interest.
SI = $\frac{PnR}{100}$
⇒ $\frac{120P}{100}$ = $\frac{P×12×R}{100}$
⇒ $R$ = $\frac{120}{12}$ = 10%
Hence, the correct answer is 10%.

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Question : Simple interest received by a person in 12 years on a principal of INR 12000 is 120% of the principal. What is the annual rate of interest?Option 1: 20%Option 2: 12%Option 3: 10%Option 4: 5%

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Question : Simple interest received by a person in 12 years on a principal of INR 12000 is 120% of the principal. What is the annual rate of interest?
Option 1: 20%
Option 2: 12%
Option 3: 10%
Option 4: 5%