Solution:
$$\eqalign{
& {\text{Let}}\,{\text{T}}{\text{.D}}{\text{.}}\,{\text{be}}\,{\text{Re}}{\text{.}}\,{\text{1}}{\text{}} \cr
& {\text{Then,}}\,{\text{B}}{\text{.D}}. = Rs.\,\frac{{11}}{{10}} \cr
& \,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\, = Rs.\,1.10 \cr
& \therefore {\text{Sum}} = Rs.\,\left( {\frac{{1.10 \times 1}}{{1.10 - 1}}} \right) \cr
& \,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\, = Rs.\,\left( {\frac{{110}}{{10}}} \right) \cr
& \,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\, = Rs.\,11 \cr
& \therefore {\text{S}}{\text{.I}}{\text{.}}\,{\text{on}}\,{\text{Rs}}{\text{.}}\,{\text{11}}\,{\text{for}}\,{\text{2}}\,{\text{years}}\,{\text{is}}\,{\text{Rs}}{\text{.}}\,{\text{1}}{\text{.10}} \cr
& \therefore {\text{Rate}} = \left( {\frac{{100 \times 1.10}}{{11 \times 2}}} \right)\% \cr
& \,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\, = 5\% \, \cr} $$
