On retirement, a woman receives Rs 1,45,440 from her provident fund and invests the entire amount in a scheme that pays 20% simple interest per annum. What will be her fixed monthly income generated from this investment?

Introduction / Context:
This aptitude question tests the concept of simple interest and the relationship between annual interest and monthly income. Such problems are common in competitive exams because they check whether you can correctly interpret interest rates expressed per annum and convert the resulting income into a monthly figure without making unit mistakes.

Given Data / Assumptions:

• Principal or invested amount, P = Rs 1,45,440.
• Rate of simple interest, R = 20% per annum.
• We assume interest is simple and paid yearly, and we want the equivalent monthly income.
• Time is effectively 1 year when computing annual interest, then we convert to monthly.

Concept / Approach:
In simple interest, interest is calculated only on the original principal throughout the entire period. The basic formula is:
Simple interest (SI) = (P * R * T) / 100where P is principal, R is rate per annum, and T is time in years. Once we know the annual interest, monthly income is simply the annual interest divided by 12 because there are 12 months in a year.

Step-by-Step Solution:
Step 1: Use the simple interest formula for one year.SI for 1 year = (145440 * 20 * 1) / 100Step 2: Simplify the calculation.145440 * 20 = 2,908,800SI for 1 year = 2,908,800 / 100 = Rs 29,088Step 3: Convert the annual interest into a monthly income.Monthly income = Annual interest / 12Monthly income = 29,088 / 12 = Rs 2,424Step 4: Match this value with the given options.The option that matches is Rs 2,424.

Verification / Alternative check:
To verify, we can reverse the process. Multiply the proposed monthly income back by 12 to see if it equals the yearly interest. Rs 2,424 * 12 = Rs 29,088, which is exactly 20% of Rs 1,45,440. This confirms that the calculation and interpretation of the rate are both correct.

Why Other Options Are Wrong:

• Rs 2,380 is slightly lower than the correct value and could result from incorrect division or rounding errors.
• Rs 2,550 is higher than the correct monthly interest and would correspond to a rate above 20% per annum.
• Rs 2,224 is too low and does not match 20% of the principal when converted annually.

Common Pitfalls:
Candidates often confuse annual and monthly rates, sometimes dividing by 10 instead of 12 or miscalculating the percentage. Another common mistake is to treat 20% as 0.2 and then forget to divide by 100 when using the formula. Careful substitution into the simple interest formula and correct conversion to a monthly figure prevent these errors.

Final Answer:
The woman will receive a fixed monthly income of Rs 2,424 from this investment at 20% simple interest per annum.