Suresh took a loan at 10% P.A. simple interest. After 4 years he returned the principal along with teh interest. If he returns in all Rs. 3500, what is the principal amount?a)Rs. 3250b)Rs. 2500c)Rs. 3150d)Rs. 2100Correct answer is option 'B'. Can you explain this answer?

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Solution:

Given, Suresh took a loan at 10% P.A. simple interest.

Let the principal amount be 'P'.

Time = 4 years

Rate of interest = 10% P.A.

Simple Interest (S.I.) = P * T * R/100

S.I. = P * 4 * 10/100

S.I. = 2P/5

Total amount (P + S.I.) = P + 2P/5 = 7P/5

Given, Suresh returned the principal along with the interest, i.e., he returned Rs. 7P/5.

It is given that he returned Rs. 3500 in all.

Hence, 7P/5 = 3500

P = (5 * 3500)/7

P = Rs. 2500

Therefore, the principal amount is Rs. 2500.

Answer: Option B.

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