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  1. The simple interest on a sum of money is 1/4th of the principal and the number of years is equal to rate per cent per annum. The rate per cent is
    1. 2.5%
    2. 5%
    3. 7.5%
    4. 10%
Correct Option: B

Let the principal be p and rate be r% per annum.
According to the question,

∴ SI =
Principal × Time × Rate
100

p
=
p × r × r
4100

r2 =
100
= 25
4

⇒ r = √25 = 5% per annum
Second method to solve this question :
Here , R = T , n =
1
5

RT = n × 100
R2 =
1
× 100
4

R2 = 25
∴ R = 5%



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