Q.Determine the annual simple interest rate (in percentage) at which the interest for 5 years becomes \(\cfrac{2}{5}\) of the principal amount.

Let the principal amount \((P) = x\) taka \[ \therefore\ \text{Total interest } (I) = \cfrac{2x}{5} \text{ taka} \quad \text{Time } (t) = 5 \text{ years} \] \[ \therefore\ \text{Rate of interest } (r) = \cfrac{100 \times I}{P \times t}\% = \cfrac{100 \times \cfrac{2x}{5}}{x \times 5}\% = \cfrac{100 \times 2}{5 \times 5}\% = 8\% \] \[ \therefore\ \text{The rate of interest is } 8\% \]
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