Simple Interest – New amount if the rate rises by 3 percentage points: ₹ 800 amounts to ₹ 920 in 3 years at simple interest. If the annual rate increases by 3 percentage points, what would be the new amount after the same 3 years?

Introduction / Context:We first deduce the original rate from the given amount progression under simple interest, then apply an increased rate for the same time period to compute the new amount.

Given Data / Assumptions:

• Original: P = ₹ 800, A = ₹ 920 after 3 years
• Rate increase Δr = 3 percentage points per annum
• Simple interest applies in both scenarios

Concept / Approach:Find original interest I = A − P; deduce annual interest and rate. New rate r_new = r_old + 3. Compute new SI and new amount.

Step-by-Step Solution:Original I = 920 − 800 = 120 over 3 years ⇒ 40 per yearOriginal rate r_old = (40 / 800) * 100 = 5%New rate r_new = 5% + 3% = 8%New SI in 3 years = 800 * 8 * 3 / 100 = 192New amount = 800 + 192 = 992

Verification / Alternative check:At 8% per annum, one-year interest is 64; over 3 years, 64 * 3 = 192; adding to principal gives ₹ 992, consistent with the calculation.

Why Other Options Are Wrong:₹ 1,056, ₹ 1,112, and ₹ 1,182 correspond to higher rates or compounding (not applicable). ₹ 980 is less than principal, impossible with positive rates.

Common Pitfalls:Confusing an increase of 3 percentage points with multiplying the original rate by 1.03. In simple interest, a “+3%” change means add 3 points to the rate, not 3% of the rate.

Final Answer:₹ 992