Question

A person invests Rs 5000 at a simple interest rate of 8 % per annum for 3 years. What is the total interest earned by the person at the end of the period?

• A. Rs 1000
• B. Rs 1200
• C. Rs 1400
• D. Rs 1600

Hint:

Remember: For simple interest, use the formula \( \text{SI} = \frac{\text{P} \times \text{R} \times \text{T}}{100} \). Ensure the rate is in percentage and time is in years.

Answer 1

The Correct Option is B

Given: \[ \text{Principal (P)} = Rs 5000, \quad \text{Rate (R)} = 8\% \, \text{per annum}, \quad \text{Time (T)} = 3 \, \text{years} \] Step 1: Formula for Simple Interest The simple interest \( \text{SI} \) is given by the formula: \[ \text{SI} = \frac{\text{P} \times \text{R} \times \text{T}}{100} \] Step 2: Substitute the values Substitute the given values into the formula: \[ \text{SI} = \frac{5000 \times 8 \times 3}{100} \] Calculate step-by-step: \[ \text{SI} = \frac{5000 \times 24}{100} = \frac{120000}{100} = Rs 1200 \] Answer: The correct answer is option (2): Rs 1200.