A sum of money invested at a simple interest amounts to Rs. 750 in 2 years and Rs. 760 in 3 years. What is the principal amount invested?
Question
A sum of money invested at a simple interest amounts to Rs. 750 in 2 years and Rs. 760 in 3 years. What is the principal amount invested?
Solution
The difference in the total amount from the 2nd year to the 3rd year is the simple interest for one year.
So, the simple interest for one year is Rs. 760 - Rs. 750 = Rs. 10.
Since the simple interest is the same every year, the simple interest for 2 years is 2 * Rs. 10 = Rs. 20.
Therefore, the principal amount invested is the total amount after 2 years minus the simple interest for 2 years.
So, the principal amount is Rs. 750 - Rs. 20 = Rs. 730.
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