Question

A weaver cooperative society takes a loan of ₹ 15,000 at the time of buying a power loom. After 5 years the society has to repay ₹ 22125 for recovering the loan. Let us determine the rate of simple interest in per cent per annum.

  • Simple Interest
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Answer

Principal = ₹ 15,000

Interest = ₹ 22125 – ₹ 15,000 = ₹ 7125

Time = 5 years

Rate = \frac{\text { Interest } × 100}{\text { Principal } × \text { Time }}

= \frac{7125 × 100}{15000 × 5}

= \frac{1425}{150}

= \frac{95}{10} = 9.5

∴ Rate = 9.5 %

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