Principal + Interest for 7 years = ₹ 7100

Principal + Interest for 4 years = ₹ 6200

∴ Interest for 3 years = ₹ 900

∴ Interest for 1 years = ₹ 300

Interest for 4 years interest = ₹ 300 × 4 = ₹ 1200

According to question

Principal + 4 years interest = ₹ 6200

or, Principal + ₹ 1200 = ₹ 6200

∴ Principal = ₹ 6200 – ₹ 1200 = ₹ 5000

Calculation of Rate

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

= \frac{1200 × 100}{5000 × 4} = 6

∴ Rate = 6 % and Principal = ₹ 5000