Question

In how many years at 8% per annum simple interest, will the interest be half of the principal?

• A. 5 years
• B. 5.5 years
• C. 6.25 years
• D. 6.5 years
• E. 7 years

Answer 1

The Correct Option is C

To solve this problem, we need to determine in how many years the simple interest on the principal will be half of the principal amount. Given the rate of interest is 8% per annum, we can use the formula for simple interest:

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

Where:

• SI is the simple interest,
• P is the principal amount,
• R is the rate of interest per annum,
• T is the time in years.

According to the problem, the simple interest is half of the principal, so we have:

SI = \frac{P}{2}

Substitute SI into the simple interest formula:

\frac{P}{2} = \frac{P \times 8 \times T}{100}

Cancel out P from both sides (assuming P \neq 0):

\frac{1}{2} = \frac{8 \times T}{100}

To find T, we rearrange the equation:

T = \frac{100}{2 \times 8}

Calculate T:

T = \frac{100}{16} = 6.25

Therefore, the interest will be half of the principal in 6.25 years.

Conclusion: The correct answer is 6.25 years. This matches the given correct answer.