Simple Interest — What equal annual payment will discharge a debt of ₹ 1696 in 4 years at 4% per annum simple interest?

Introduction / Context:
The original stem omitted the number of years. By the Recovery-First policy, we minimally repair the stem to the standard 4-year annuity-at-simple-interest version that is consistent with the answer set. Under SI, each installment is increased linearly to the focal date and the totals are equated to the amount due.

Given Data / Assumptions (Repaired):

• Debt amount to be cleared at end of year 4: ₹ 1696.
• Equal annual payment A at ends of years 1–4.
• Rate r = 4% p.a., simple interest.

Concept / Approach:
Accumulate each A to end of year 4: factors are 1 + r*(4 − k) for k = 1..4. Sum of factors = 4 + r*(1 + 2 + 3) = 4 + 0.04*6 = 4.24.

Step-by-Step Solution:
(Accumulated total) = A * 4.24 = 1696.A = 1696 / 4.24 = ₹ 400.

Verification / Alternative check:
Check: 400*(1.12 + 1.08 + 1.04 + 1.00) = 400*4.24 = 1696 (matches).

Why Other Options Are Wrong:
₹ 525, ₹ 425, ₹ 350, ₹ 325 do not satisfy the 4.24 multiplier relation.

Common Pitfalls:
Using compound accumulation or forgetting to use the arithmetic series of SI factors for the buildup.

Final Answer:
₹ 400