Question

If Rehman deposited Rs. 1,50,000 in a bank for 3 years at the rate of $8\% $ per annum, how much interest will he receive at the end of the period.

Answer 1

Hint: From the question, we can find the principal amount, the number of years for which the money is deposited and the rate of interest. Then we can convert the rate of interest to fraction by dividing it by 100. Then we can find the interest by substituting the values to the equation $I = P \times N \times R$ , to obtain the required answer.

Complete step-by-step answer:
It is given that Rehman deposited Rs. 1,50,000. Then we can write the principle amount P as
 $ \Rightarrow P = 1,50,000$
It is given that the deposit is for 3 years. So, we can write the number of years given by N.
 $ \Rightarrow N = 3$
It is given that the rate of interest is $8\% $ per annum. It can be represented as R and can be written as
 $ \Rightarrow R = 8\% $
We can convert the percentage into fraction by dividing it by 100.
 $ \Rightarrow R = \dfrac{8}{{100}}$
We know that the amount of simple interest is given by the equation,
 $I = P \times N \times R$
, where P is the principle amount, N is the number of years and R is the rate of interest per year.
On substituting the values of P, N and R, we get the interest as,
  $ \Rightarrow I = 1,50,000 \times 3 \times \dfrac{8}{{100}}$
On cancelling the zeros, we get,
 $ \Rightarrow I = 1,500 \times 3 \times 8$
On further calculations, we get,
 $ \Rightarrow I = 36,000$
So, the interest of 3 years for the amount of Rs. 1,50,000 at a rate of $8\% $ per annum is Rs. 36,000.
Therefore, at the end of period Rehman will receive an interest of Rs. 36,000.

Note: Alternate method to solve this problem is given by.
It is given that Rehman deposited Rs. 1,50,000.
It is given that the rate of interest is $8\% $ per annum.
Thus, the interest for 1 year is given by $8\% $ of Rs. 1,50,000.
 $ \Rightarrow {I_1} = \dfrac{8}{{100}} \times 150,000$
On simplification, we get,
 $ \Rightarrow {I_1} = 12000$
Now we can find the interest for 3 years by multiplying the interest of 1 year with 3.
 $ \Rightarrow I = 12000 \times 3$
On further calculations, we get,
 $ \Rightarrow I = 36,000$
Therefore, at the end of period Rehman will receive an interest of Rs. 36,000