Question

A sum borrowed under compound interest doubles itself in 10 years. When will it become fourfold of itself at the same rate of interest?

• A. 24 years
• B. 18 years
• C. 20 years
• D. 40 years

Answer 1

Answer:

C. 20 years

Solution:

Given : 

A sum doubles itself in 10 years

Formula used : 

$Amount = P(1+\frac{R}{100})^n$

If In the compound interest condition, Principal (P) and rate of interest (R) are the same, then 

Time is proportional to the Amount (A) after adding compound interest.

T₁/T₂ = A₁/A₂

Calculation:

Let, Total time to fourfold of itself at the same rate of interest = T2 

T1 = 10 years    (given)

A₁ = 2P    (Amount after 10 years)

T₁/T₂ = A₁/A₂

10/T₂ = 2P/4P

T₂ = 20 years

Total time to fourfold of itself at the same rate of interest = 20 years