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Find the principal which amounts to ₦ 5,500 at a simple...

Find the principal which amounts to ₦ 5,500 at a simple interest in 5 years at 2% per annum

A.

₦ 4,900

B.

₦ 5,000

C.

₦ 4,700

D.

₦ 4,000

Correct answer is B

Principal = P, Simple Interest = I, Amount = A

Amount = Principal + Simple Interest

I = \(\frac{PRT}{100}\)

R = rate, T = time

I = \(\frac{P \times 5 \times 2}{100}\)

I = \(\frac{10P}{100}\)

I = \(\frac{P}{10}\)

Amount A = P + I

5500 = P + \(\frac{P}{10}\)

Multiply through by 100

5500 = 10P + P

5500 = 11P

p = \(\frac{5500}{11}\)

p = ₦5000