Q:
The total simple interest earned on a sum of money increases by Rs. 600 when the rate of interest increases by 2% per annum. If the investment was made for 5 years, find the sum of money that was invested ?
Answer & Explanation
Answer: A) Rs. 6000
Explanation: Let the sum invested be Rs. P
Let the rate of interest be R% per annum
=> Interest earned for 5 years = (P x 5 x R/100) = PR/20
Now, given that the interest earned increased by Rs. 600 if the Rate increased to (R+2)%
=> SI = (P x 5 x (R+2))/100 = PR/20 + 10P/100
Hence,
PR/20 + 10P/100 = PR/20 + 600
=> P = 6000
Therefore, the sum invested is Rs. 6000
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