Question

A farmer borrowed a sum of Rs 10,000 from a Rural Development Bank at the rate of 7.5% p.a. If he/she paid an amount of Rs 15,250 to clear the debt, how long did he/she use the sum? ​

Answer 1

We can use the formula:

Simple Interest (SI) = (P * R * T) / 100

Where P is the principal amount, R is the rate of interest per annum, and T is the time duration for which the amount was borrowed.

Let's substitute the given values:

SI = 15,250 - 10,000 = 5,250
P = 10,000
R = 7.5%

Now, we can rearrange the formula to find T:

T = (SI * 100) / (P * R)

Substituting the values:

T = (5,250 * 100) / (10,000 * 7.5)
T = 7 years

Therefore, the farmer used the sum for 7 years.