Question

An amount invested at 12% simple interest amounts to Rs.6200 in 2 years. The principal amount is

• A. Rs.5000
• B. Rs.5200
• C. Rs.5400
• D. Rs.5600

Hint:

Use $A = P(1 + \frac{RT}{100})$ directly when amount is given in simple interest problems.

Answer 1

The Correct Option is A

To find the principal amount that was invested under simple interest, we use the formula for simple interest:

\(A = P + SI\), where:

• \(A\) is the total amount after interest,
• \(P\) is the principal amount,
• \(SI\) is the simple interest.

The simple interest formula is given by:

\(SI = \frac{P \times R \times T}{100}\), where:

• \(R\) is the rate of interest,
• \(T\) is the time in years.

From the problem, we have:

• Total amount \(A = 6200\) Rs,
• Rate of interest \(R = 12\%\),
• Time \(T = 2\) years.

First, express the total amount in terms of the principal:

\(6200 = P + \frac{P \times 12 \times 2}{100}\)

Simplify the equation:

\(6200 = P + \frac{24P}{100}\)

Convert the fraction:

\(6200 = P + 0.24P\)

Combine the terms:

\(6200 = 1.24P\)

Now, solve for \(P\):

\(P = \frac{6200}{1.24}\)

Calculate the value:

\(P = 5000\) Rs

Thus, the principal amount is Rs. 5000.

Therefore, the correct answer is option 1.