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An amount deposited at 5 percent simple interest becomes Rs. 1512 in 4 years. What will the same amount become in 2.5 years at 10 percent simple interest per annum?

ARs. 1,475
BRs. 1,575 ✓ Correct
CRs. 1,675
DRs. 1,875
Correct answer: (B) Rs. 1,575
Explanation

The amount becomes Rs. 1,575.

At 5% for 4 years, amount = P(1 + 0.05 x 4) = 1.2P = 1512.

So principal P = 1512/1.2 = 1260.

At 10% for 2.5 years, amount = 1260(1 + 0.10 x 2.5) = 1260 x 1.25.

= 1575.

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