Ajay borrowed a sum of ₹20000 at a certain rate of simple interest for 4 years. If he paid an interest of ₹4000 at the end of the period at x% per annum rate of interest, the value of x is:

1. A

   4

2. B

   7

3. C

   6

4. D

   5

Appeared in: NCL (Northern Coalfields Limited)-NO

Explanation

• The problem requires calculating the rate of interest using the simple interest formula.
• The formula for Simple Interest (SI) is SI = (P × R × T) / 100, where P is Principal, R is Rate, and T is Time.
• Rearranging the formula to find the rate (R) gives R = (SI × 100) / (P × T).
• Substituting the given values: P = ₹20,000, SI = ₹4,000, and T = 4 years.
• Calculation: R = (4000 × 100) / (20000 × 4) = 400000 / 80000 = 5.
• Thus, the rate of interest (x) is 5%.

Why Other Options Were Wrong

• Option A: If the rate were 4%, the simple interest would be (20000 × 4 × 4) / 100 = ₹3200, not ₹4000.
• Option B: If the rate were 7%, the simple interest would be (20000 × 7 × 4) / 100 = ₹5600, not ₹4000.
• Option C: If the rate were 6%, the simple interest would be (20000 × 6 × 4) / 100 = ₹4800, not ₹4000.

Related Visual

• Visual 1: Infographic: A visual breakdown of the Simple Interest formula (SI = PxRxT/100) with each component (Principal, Rate, Time) clearly defined and an example calculation shown.

Clinical Relevance

• Nursing practice connection: This is primarily an exam-oriented knowledge point with limited direct bedside application, so retain Simple Interest Calculation as background academic context rather than a clinical decision trigger.
• This is a general mathematics question testing numerical ability, which is a component of many competitive examinations, including those for nursing positions.
• While not a direct clinical skill, proficiency in basic mathematics is essential for nurses for tasks like medication dosage calculations, fluid balance monitoring, and interpreting patient data.
• What if the interest was compounded annually? If the interest was compounded, the calculation would be more complex, using the formula A = P(1 + R/100)^T, and the effective interest paid would be higher than simple interest.

How to Approach the Question

• First, identify all the given numerical values from the question: Principal (P), Simple Interest (SI), and Time (T).
• Recognize that the question is asking for the Rate of Interest (R), denoted as 'x'.
• Recall the standard formula for calculating Simple Interest: SI = (P × R × T) / 100.
• Rearrange this formula algebraically to solve for the unknown variable, which is R in this case: R = (SI × 100) / (P × T).
• Substitute the known values into the rearranged formula.
• Perform the calculation to find the value of R (or x) and select the matching option.

Concept Tested & Keywords

• Concept Tested: Simple Interest Calculation
• Stem keywords: Simple Interest, Principal, Rate, Time
• Lead-in keywords: the value of x is

Question ID

QOBDPsU9nu3j9yE_iGandT

Copy ID