Question

Mr. Kamat donated Rs. 80000 to a welfare trust on the agreement with them that the interest on the sum will be used for awarding 5 scholarships of equal value of year to physically handicapped children. If donation earns an interest of 10% per annum, find the value of each scholarship.

Answer 1

Hint: We are provided with the total amount , no. of scholarships and the rate of interest . Using the rate of interest we can find the total amount of money for scholarship. Then using the no. of scholarship it is easier to calculate the amount of scholarship for a single child.

Complete step-by-step answer:

Amount donated by Kamat = Rs. 80000

Interest earned at the rate of 10% p.a = 10% of 80000
= $\dfrac{{10}}{{100}} \times 80000$
= Rs. 8000

Number of scholarships = 5

$\therefore $Value of each scholarship = Rs. $\dfrac{{8000}}{5}$
= Rs. 1600

Note: An interest rate is the amount of interest due per period, as a proportion of the amount lent, deposited or borrowed. The total interest on an amount lent, or borrowed depends on the principal sum, the interest rate, the compounding frequency, and the length of time over which it is lent, deposited or borrowed.