A man took loan from a bank at the rate of 12% p.a. simple interest. After 3 years he had to pay Rs. 5400 interest only for the period. The principal amount borrowed by him was:

Given data

• Simple Interest (SI) paid after 3 years = Rs. 5400
• Rate of interest r = 12% p.a.
• Time t = 3 years

Formula

SI = (P × r × t) ÷ 100

Step 1: Substitute values
5400 = (P × 12 × 3) ÷ 1005400 = (36P) ÷ 100

Step 2: Solve for principal P
P = 5400 × 100 ÷ 36P = 540000 ÷ 36 = Rs. 15,000

Final Answer: The principal amount borrowed was Rs. 15,000.