If the simple interest on a sum of money invested at 3% per annum for 2\(\frac{1}{2}\) years is N123, find the principal.

If the simple interest on a sum of money invested at 3% per annum for 2\(\frac{1}{2}\) years is N123, find the principal.

Answer Details

The formula for simple interest is: I = PRT Where: I = Interest P = Principal R = Rate of Interest T = Time From the question: R = 3% per annum T = 2.5 years I = N123 We can substitute the values given into the formula and solve for P: 123 = P x 0.03 x 2.5 123 = 0.075P P = 123 ÷ 0.075 P = N1,640 Therefore, the principal is N1,640. Answer option (C).