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A person invests Rs.12,000 as fixed deposit at a bank at the rate of 10% per annum simple interest. But due to some pressing needs he has to withdraw the entire money after 3 years, for which the bank allowed him a lower rate of interest. If he gets Rs.3320 less than what he would have got at the end of 5 years, the rate of interest allowed by the bank is :
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Explanation:
Principal = Rs.12000,
Rate \% = 10 \%
Interest paid by the person in 5 years
=12000×10×5\100 =Rs.6000
Interest received by the person after 3years
=Rs.(6000−3320)=Rs.2680
By using formula,
Rate \% =2680\12000×100\3=67\9=7 4\9%
Hence required Rate \%=7 4\9%