CA Foundation · Quantitative Aptitude · Mathematics of Finance
Rajesh invests ₹50,000 in a fixed deposit that offers 8% per annum simple interest. How much interest will he earn after 3 years?
The simple interest earned is ₹12,000. Using SI = (Principal × Rate × Time) / 100, we get (50,000 × 8 × 3) / 100 = ₹12,000. This is straightforward application of the simple interest formula.
- A₹10,000
- B₹12,000Correct
- C₹14,000
- D₹16,000
Explanation
Using simple interest formula: SI = (P × R × T) / 100. Here, SI = (50,000 × 8 × 3) / 100 = 1,200,000 / 100 = ₹12,000. Option 0 (₹10,000) results from incorrectly using 5% rate, while option 2 assumes 7% and option 3 assumes 8% but with T=4.
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