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Quantitative Finance Level 1

The simple interest on a certain sum of money at the rate of 5 % 5\% p.a. for 8 8 years is R s . 840 Rs.840 . At what rate of interest the same amount of interest can be received on the same sum after 5 5 years?

Note:- Basic knowledge of Rupee is necessary to crack this problem \text{Note:- Basic knowledge of Rupee is necessary to crack this problem}

Enjoy! \text{Enjoy!}


The answer is 8.

Parag Zode by Parag Zode , 24, India

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1 solution

Parag Zode
May 14, 2015

Simple Interest S . I S.I = R s . 840 Rs.840 , R R = 5 % 5\% , T T = 8 8 years.

We know the formula S . I = P . R . T 100 S.I = \dfrac{P . R. T}{100}

Principal, P P = R s Rs 100.840 5.8 \dfrac{100 . 840}{5 . 8}

P P = R s . 2100 Rs.2100

Now, for calculating rate of interest, S . I S.I and T T are same and P P = R s . 2100 Rs.2100

So, R R = 100.840 2100.5 \dfrac{100 . 840}{2100 . 5} which gives us 8 % 8\%

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