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At what simple annual interest rate must $2,500 be invested if it is to earn $225 in interest in one year?
(A) 6%
(B) 7%
(C) 8%
(D) 9%
(E) 10%
(A) 6%
(B) 7%
(C) 8%
(D) 9%
(E) 10%
Abhishek009
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Joined: 11 Jun 2011
Last visit: 17 Dec 2025
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Status:QA & VA Forum Moderator
Location: India
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WE:Business Development (Commercial Banking)
Posts: 5,879
NandishSS
\(225 = \frac{2500*1*r}{100}\)
So, \(225 = 25r\)
Thus, \(r = 9\)% ; Answer must be (D)
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Posts: 6,727
NandishSS
Let x = the PERCENT annual interest rate
So, we want: x percent of $2,500 = 225
Rewrite as: x/100 of $2,500 = 225
In other words: (x/100)(2,500) = 225
Simplify: 2500x/100 = 225
Simplify again: 25x = 225
Solve: x = 225/25 = 9
Answer: D
Cheers,
Brent
Posts: 160
NandishSS
225=2500*r*1/100
r=9%
D
Posts: 4,849
Everyone knows that SI = PRT/100
Just an alternative thought process for this sum.
10% of 2500 is 250. We want an Interest of 225. 1% of 250 = 25 and 250 - 25 = 225
So the required percentage is 10 - 1 = 9%
Option D
Arun Kumar
Just an alternative thought process for this sum.
10% of 2500 is 250. We want an Interest of 225. 1% of 250 = 25 and 250 - 25 = 225
So the required percentage is 10 - 1 = 9%
Option D
Arun Kumar
Posts: 31
NandishSS
Two intuitive approaches:
1) 25 is 1% of 2500, so \(\frac{225}{25}\) = 9% of 2500
2) What fraction of 2500 does 225 represents? answer is \(\frac{225}{2500}\), but we want to know the percentage of 2500 that 225 represents, so we need to multiply the fraction by 100 -> \(\frac{225}{2500}*100\) = \(\frac{225}{25}\) = 9%
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