Question

What is the simple interest on 2000 at $5%$ per annum for 2 years?

• A. 100
• B. 150
• C. 200
• D. 250

Hint:

Simple interest calculations are straightforward multiplication. $5%$ per year for 2 years means a total interest rate of $10%$. $10%$ of $2000$ is $200$.

Answer 1

The Correct Option is C

We use the Simple Interest ($\text{SI}$) formula: $\text{SI} = \frac{P \times R \times T}{100}$.
Given: Principal ($P$) $= 2000$.
Rate ($R$) $= 5$.
Time ($T$) $= 2$.
$\text{SI} = \frac{2000 \times 5 \times 2}{100}$.
$\text{SI} = \frac{20000}{100}$.
$\text{SI} = 200$.