Cognizant Simple and Compound Interest Quiz-1

SI = \frac{(P \times R \times T)}{100}

= \frac{(2000 \times 3 \times 2)}{100}

= RS 120

The simple interest formula is given by :
Simple interest = \frac {Principle \times rate \times time}{100}
In simple interest, the interest does not earn interest hence the amount increases by a constant amount every time.
From this information, we can comfortably answer this question.
Between year 5 and year 7 the amount increases by :
3000 - 2500 = 500
This is in a span of 2 years.
The annual interest is given by:
Annual interest = \frac{500}{2} = rs 250
For 5 years the interest earned equals to :
250 × 5 = 1250.
The Sum is thus :
2500 - 1250 = 1250

By the problem \frac {Principle \times rate \times time}{100} = 1500
or, \frac {5000 \times 2.5 \times t}{100}=1500
which gives t = 12 years.

S.I= \frac {Principle \times rate \times time}{100}
p=5000;

n=5;

r=12

S.I = \frac {5000\times 5 \times 12}{100}
S.I=3000
Amount after 5 yrs  = Principle + S.I
= 5000 + 3000

= 8000