By Ajay Kumar

Verified by Ajay Kumar

A sum of money amounts to ₹6,720 in 4 years and to ₹7,680 in 6 years at a certain rate of simple interest. What is the annual rate of interest?

  1. 8%

  2. 9%

  3. 10%

  4. 12%

Answer: C

Solution

The difference between the amounts is \(7680-6720=960\)₹, which is the simple interest for 2 years. Annual interest \(=960/2=480\)₹. Principal \(=6720-(4\times480)=4800\)₹. Rate \(=\frac{480\times100}{4800}=10\%\). Trick: Subtract the amounts to find the interest for the difference in years.

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