A sum of money lent out at simple interest amounts to 720

Home » Aptitude » Simple interest » Question

A sum of money lent out at simple interest amounts to 720 after 2 years and to 1020 after a further period of 5 years. The sum is :

1. 500
2. 600
3. 700
4. 710

Correct Option: B

As per the given in question ,
Principal + SI for 2 years = ₹720 .... (i)
Principal + SI for 7 years = ₹1020 .....(ii)
Subtracting equation (i) from (ii) get,
SI for 5 years = (1020 – 720) = ₹300
∴ SI for 2 years = 300 × ( 2 ÷ 5 ) = ₹120
∴ Principal = Amount - SI = (720 – 120) = ₹600
Second method to solve this question :
Here , A₂ = ₹ 1020 , T₁ = 2 years , A₁ = ₹ 720 , T₂ = 7 years

P =		A₂T₁ - A₁T₂
		T₁ - T₂

P =		1020 × 2 - 720 × 7
		2 - 7

P =		2040 - 5040
		- 5

P =	- 3000
	- 5

P = ₹ 600