On which rate ₹ 500 will become ₹ 605 in 3 years?
A) 7%
B) 6%
C) 12%
D) 9%
Correct option is (A) 7%
P = 500, T = 3 years. Let rate of interest be R
Amount after 3 years = P + S.I.
= P + \(\frac{PRT}{100}\)
\(=500+\frac{500\times R\times3}{100}\)
= 500 + 15R
Given that amount after 3 years is Rs 605.
\(\therefore\) 500 + 15R = 605
\(\Rightarrow\) 15R = 605 - 500 = 105
\(\Rightarrow\) R = \(\frac{105}{15}\) = 7%