What sum (in ₹) will earn a simple interest of ₹1,680 in 4 years at 8% per…

Concept

Simple interest is calculated only on the original principal, so it grows in direct proportion to the principal, annual rate, and time.

If the principal is P, the annual rate is R%, and the time is T years, then SI = (P × R × T) / 100. Therefore, P = (SI × 100) / (R × T).

Application

1. Set SI = ₹1,680, R = 8, and T = 4.

2. Substitute the values: P = (1,680 × 100) / (8 × 4).

3. Simplify the denominator: P = 168,000 / 32.

4. Divide to obtain P = ₹5,250.

Cross-check

For P = ₹5,250, SI = (5,250 × 8 × 4) / 100 = ₹1,680, which reproduces the given interest.

Therefore, the required sum is ₹5,250.