Simple interest on a sum is 25% of the principal and the number of years is equal to rate percent per annum. Find the rate of interest.25%5%7.5%7%
Question
Solution
The formula for simple interest is I = PRT/100, where I is the interest, P is the principal, R is the rate of interest, and T is the time in years.
Given that the interest is 25% of the principal, we can write this as I = 25P/100.
We are also given that the number of years is equal to the rate percent per annum, so T = R.
Substituting these values into the formula, we get:
25P/100 = PR^2/100.
Solving for R, we get R^2 = 25, so R = 5 or R = -5.
Since the rate of interest cannot be negative, the rate of interest is 5%.
So, the correct answer is 5%.
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