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The total simple interest earned on a sum of money increases by Rs. 600 when the rate of interest increases by 2% per annum. If the investment was made for 5 years, find the sum of money that was invested ?

Correct Answer: Rs. 6000

Explanation:

Let the sum invested be Rs. P


Let the rate of interest be R% per annum


=> Interest earned for 5 years = (P x 5 x R/100) = PR/20


Now, given that the interest earned increased by Rs. 600 if the Rate increased to (R+2)%


=> SI = (P x 5 x (R+2))/100 = PR/20 + 10P/100


Hence,


PR/20 + 10P/100 = PR/20 + 600


=> P = 6000


Therefore, the sum invested is Rs. 6000


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