Reena took a loan of Rs. 1200 with simple interest for as many years as the rate of interest. If she paid Rs. 432 as interest at the end of the loan period, what was the rate of interest ?

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3.6

Can’t be determined

answer is B.

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Detailed Solution

Concept- We are aware that the following formula yields the simple interest rate on a certain principal amount.

is the formula for simple interest, where P denotes the principle sum for which interest is charged, R denotes the interest rate, and T is the amount of time in years.
Let's now assume that time period (T) Equals rate of interest (R) = x. (Since they are presumed to be equal)
Inputting these values into the formula previously mentioned will result in the following expression.
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Considering that Reena took the Rs. 1200 principal payment. Consequently, adding this to the previous statement yields the following expression.
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We know that she paid Rs. 432 at the end of the time period because it was handed to us. Thus, we have
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Hence, the correct answer is option 2.

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