A sum of 8000 amounts to 9200 in three years at simple interest. If the…
2016
A sum of 8000 amounts to 9200 in three years at simple interest. If the interest rate is increased by 2%, interest earned for three years is?
- A.
1680
- B.
1580
- C.
1450
- D.
1600
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Correct answer: A
The simple interest for 3 years is 9200 - 8000 = 1200. This gives an annual rate of 1200 x 100 / (8000 x 3) = 5%. If the rate is increased by 2%, the new rate is 7%, so interest for 3 years is 8000 x 7 x 3 / 100 = 1680.