A shopkeeper takes a loan of Rs. 54,000 with simple interest for 6 years at the rate of 6%. At the end of the loan period, what is the interest that he pays?
1. Rs. 12,440
2. Rs. 22,440
3. Rs. 18,440
4. Rs. 19,440
1. Rs. 12,440
2. Rs. 22,440
3. Rs. 18,440
4. Rs. 19,440
Correct Answer – Option 4 : Rs. 19,440
Given:
A shopkeeper takes a loan (Principal) = Rs. 54000
Time = 6 years
Rate = 6%
Concept used:
Simple interest = (Principal × Rate × Time)/100
Calculation:
Simple interest = (Principal × Rate × Time)/100
⇒ (54,000 × 6 × 6)/100
⇒ 540 × 36
⇒ Rs. 19,440
∴ The simple interest is Rs. 19,440