Due to a fall in the rate of interest from $13\%$ p.a. to $12\frac{1}{2}\%$ p.a., a money lender's yearly income diminishes by ₹ $104$. His capital is :

Rate reduce from $13\%$ to $12\frac{1}{2}\% $ p.a.

Decrease in rate $= 0.5\%$

Decline in interest $= \text₹~104$

$\begin{align} 0.5\%~of~capital &= 104 \\ \implies capital &= \frac{104}{0.5}\times 100 = \text₹~20800 \end{align}$

Option B.

Answer is B

$\frac{P*13*1}{100}-\frac{P*25*1}{2*100} = 104$

P = 200*104 = Rs.20800