Question

Priya invested a certain amount of money and got back an amount of Rs. 15000. If the bank paid an interest of Rs. 5000, what is the amount of money Priya invested?
(a) Rs. 5,000
(b) Rs. 8,000
(c) Rs. 15,000
(d) Rs. 10,000

Answer 1

Hint: It is a word problem related to the money exchange, and the only thing that you need to focus on for solving this problem is interest is the difference of amount and the principal. So, the investment of Priya is the principal, and the money she got back is the amount, including the interest. So, use the formula Amount = principal + interest and put the values given in the question to solve the problem.

Complete step-by-step answer:
It is a word problem related to the money exchange, and the only thing that you need to focus on for solving this problem is interest is the difference of amount and the principal. So, the investment of Priya is the principal for this question.

Before starting with the question, let us know about interest.
Interest in the financial term is the amount that a borrower pays to the lender along with the repayment of the actual principal amount.
Broadly, there are two kinds of interest, first is the simple interest, and the other is the compound interest.
Now to start with the solution, we let the amount invested by Priya in the bank i.e., the principal, to be Rs. x.
Now according to the definition of interest: amount is defined as the sum of principal and the interest. Therefore, the equation becomes:
Amount = principal + interest
Now we will substitute the value of interest and the principal with the values given in the question.
\[\Rightarrow 15000\text{ }=\text{ }x\text{ }+\text{ }5000\]
\[\Rightarrow x=15000-5000=10000\]
Therefore, Priya invested Rs. 10,000 in the bank. Hence, the answer to the above question is option (d).


Note: Don’t get confused and take 15000 to be the principal amount. Also, be careful with the calculations and solving part as there is a possibility of making a mistake in the calculations. It is recommended to learn all the basic formulas related to simple as well as compound interests as they are very much useful in the problems related to money exchange.