Test Index

Time Value of Money

Question : 48 of 99

Marks: +1, -0

P\ \%

for P years will be Rs. P on a sum of :

Solution:

Concept:

The sum (principal) is found using the simple interest formula

SI = \frac{P \times R \times T}{100}

Explanation:

Let the sum (principal) be

S

(in Rs.).

Given: Rate

R = P\%

, Time

T = P

years, Simple Interest

SI = P

Using formula:

P = \frac{S \times P \times P}{100} = \frac{S \times P^2}{100}

Multiply both sides by 100:

100P = S \times P^2

Divide both sides by

P^2

(assuming

P \neq 0

S = \frac{100P}{P^2} = \frac{100}{P}

Answer:

Rs.

\frac{100}{P}

(Option B).

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