A sum invested at 10% p.a. for 2 years becomes Rs. 3,267, when the interest is compounded annually. What will be the simple interest on the same sum at the same rate in  years?

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CTET (Mathematics & Science) Official Paper-II (Held On: 07 Jul, 2024)
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  1. Rs. 675
  2. Rs. 700
  3. Rs. 625
  4. Rs. 650

Answer (Detailed Solution Below)

Option 1 : Rs. 675
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CTET CT 1: TET CDP (Development)
10 Qs. 10 Marks 8 Mins

Detailed Solution

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Given: 

A is the amount after 2 years = 3267 

r is the rate of interest = 10% 

n is  the number of years = 2 years 

Concept Used: 

A = P (1 +  )2

S.I = 

Calculation: 

Determine the principal amount 

A = P (1 +  )2

⇒ 3267 = P (1 + 10/100)2

⇒ P = 3267 ×  100/ 110  ×  100/ 110   = 2700

Now Simple Interest

S.I = 

S.I = 2700 × 10× 2.5 /100 = 675

∴ The Correct answer is Option (1): Rs. 675

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