Question

Find the amount for Rs. $ 5000 $ for $ 4 $ months at $ 12.5\% $ rate of interest p.a. (assume simple interest)

Answer 1

Hint: Interest can be defined as the amount paid for using someone else’s money. Here we will use the formula for simple interest and place the given data, also amount is the sum of the principal amount and the interest and simplify for the resultant required value.

Complete step-by-step answer:
Given that:
Principal, $ p = Rs.5000 $
Term period $ ,{\text{ T = 4}} $ months
Convert the term period in years
Therefore, Term period $ ,{\text{ T = }}\dfrac{{\text{4}}}{{12}} = \dfrac{1}{3} $ years
Rate of interest, $ R = 12.5\% $
Simple interest can be given by the formula,
 $ I = \dfrac{{PTR}}{{100}} $
Place the given values in the above expression –
 $ I = \dfrac{{5000 \times 12.5 \times 1}}{{100 \times 3}} $
Find the factors for the terms in the numerator of the above expression –
\[I = \dfrac{{50 \times 100 \times 12.5 \times 1}}{{100 \times 3}}\]
Common factors from the numerator and the denominator cancel each other and therefore remove from the numerator and the denominator.
 $ I = \dfrac{{5 \times 125}}{3} $
Simplify the above expression finding the product of the terms on the right hand side of the above expression.
 $ I = 208.3 $ Rs.
Now, the amount is the sum of the principal value and the interest.
 $ A = P + I $
Place the values and simplify the expression –
 $ A = 5000 + 208.3 $
Simplify the expression adding the terms in the above expression –
 $ A = 5208.3 $ Rs.
Hence, the amount for the said principle, term period and the rate of interest is Rs. $ 5208.3 $
So, the correct answer is “Rs. $ 5208.3 $ ”.

Note: Be careful about the value for “t” here the term period is given is in months so always convert it in the form of the term in year and then and then only place it in the formula to simplify. Since, interest is calculated yearly basis.