Correct
Not quite — the correct answer is highlighted
Show answer & explanationHide answer
Answer: (B) 4,400
Explanation
The total simple interest can be calculated by summing the interest earned across the different time periods. Since the principal amount P = 5,000 remains constant, the total interest is given by the formula SI = (P × Σ (R × T))/(100).
The time breakdown for the 10-year period is: For the first 2 years, R₁ = 6%, so R₁T₁ = 6 × 2 = 12%. For the next 2 years, R₂ = 8%, so R₂T₂ = 8 × 2 = 16%. For the remaining period of 10 - 4 = 6 years, R₃ = 10%, so R₃T₃ = 10 × 6 = 60%.
The total effective interest rate over 10 years is 12% + 16% + 60% = 88%.
Total interest earned = (5,000 × 88)/(100) = 50 × 88 = 4,400.