If the principal amount is $2000 and the total amount after 3 years at a certain
Practice Questions
Q1
If the principal amount is $2000 and the total amount after 3 years at a certain rate of simple interest is $2400, what is the rate of interest? (2000)
5%
6.67%
10%
12%
Questions & Step-by-Step Solutions
If the principal amount is $2000 and the total amount after 3 years at a certain rate of simple interest is $2400, what is the rate of interest? (2000)
Step 1: Identify the principal amount (P), which is $2000.
Step 2: Identify the total amount after 3 years, which is $2400.
Step 3: Calculate the interest earned by subtracting the principal from the total amount: Interest = Total Amount - Principal = $2400 - $2000 = $400.
Step 4: Use the formula for simple interest: SI = PRT, where SI is the interest, P is the principal, R is the rate of interest, and T is the time in years.
Step 5: Substitute the known values into the formula: 400 = 2000 * R * 3.
Step 6: Simplify the equation: 400 = 6000R.
Step 7: Solve for R by dividing both sides by 6000: R = 400 / 6000.
Step 8: Calculate R: R = 0.0667.
Step 9: Convert R to a percentage by multiplying by 100: R = 0.0667 * 100 = 6.67%.
Simple Interest Calculation – Understanding how to calculate simple interest using the formula SI = PRT, where SI is the interest, P is the principal, R is the rate, and T is the time.
