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: Here the principal amount is given and also the rate of interest is given. We will convert the rate of interest into fraction by dividing it by 100. Then we will use the formula for simple interest which is given by:-
\[I = P \times R \times T\] where P is the principal amount, R is the rate of interest in fraction, T is the time period.

Complete step-by-step answer:
It is given that Rehman deposited Rs. 1,50,000.
Hence the principal amount P is Rs. 1,50,000
\[P = 150000\]
Now it is given that the money is deposited for 3 years so the time period is given by:-
\[T = 3\]
Also, it is given that the rate of interest is 8% per annum.
Hence, \[R = 8\% \]
Converting it into fraction by dividing by 100 we get:-
\[R = \dfrac{8}{{100}}\]
Now we know that, the simple interest is given by:-
\[I = P \times R \times T\] where P is the principal amount, R is the rate of interest in fraction, T is the time period.
Hence, putting in the respective values we get:-
$\Rightarrow$\[I = 150000 \times \dfrac{8}{{100}} \times 3\]
Solving it further we get:-
$\Rightarrow$\[I = 1500 \times 8 \times 3\]
Evaluating the value of I we get:-
$\Rightarrow$\[I = 36000Rs\]

Therefore, the required interest is Rs. 36000.

Note: An alternative method to solve such problems is to evaluate the interest of one year and then multiply it by the given time period to get the answer.
Hence, the interest of 1 year of Rs. 1,50,000 at the rate of 8% is given by:-
\[{I_1} = 150000 \times \dfrac{8}{{100}}\]
Simplifying it we get:-
\[{I_1} = 1500 \times 8\]
\[{I_1} = 12000\]
Now the interest of 3 years is given by:-
\[{I_3} = 12000 \times 3\]
Solving it further we get:-
\[{I_3} = 36000Rs\]