Question

What is the S.I of Rs. 800 on 5 % per annum for 3 years?
(a) 120
(b) 200
(c) 100
(d) 400

Answer 1

Hint: If we have principal (P), rate (r), and time (t), then the value of the simple interest (S.I) is given as follows:
\[S.I=\dfrac{P\times r\times t}{100}\]

Complete step by step answer:
In the given question, we have been given P = Rs. 800, r = 5 % and t = 3 years. Now we know that if we have P, r and t, then the S.I is given as follows:
\[S.I=\dfrac{P\times r\times t}{100}......\left( i \right)\]
We will substitute the values of P, r and t in the equation (i) and we get,
\[S.I=\dfrac{800\times 5\times 3}{100}\]
On multiplying the terms of the numerator, we get
\[S.I=\dfrac{12000}{100}\]
On cancelling the zeros and simplifying it further, we get
S.I = Rs. 120
Hence, we get the value of S.I as equal to Rs. 120.
Therefore the correct option of this question is (a).

Note:Students have to be careful while multiplying the terms of the numerator as they might make a mistake, otherwise the calculation is quite easy. Also, they should remember that they do not have to substitute the value of rate by changing it from percentage as it has been already converted in the formula of simple interest (S.I). Simple interest is different from compound interest, so students must not get confused with both these concepts. They must read the question carefully and then apply the formula for simple interest.