Q.If the annual simple interest rate increases from 4% to 5%, causing a person's income to rise by ₹1000, then the person's principal amount is _____. (a) ₹ 4000 (b) ₹ 5000 (c) ₹ 10000 (d) ₹ 50000
Answer: C
Let the person's principal amount be \(x\) rupees.
The interest rate increases by (5% - 4%) = \(1\)%
\(\therefore \) According to the question, \(\cfrac{x\times 1\times 1}{100}=1000\)
Or, \(x=1000\times 100=10000\)

\(\therefore\) The person's principal amount is ₹10,000.
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