Free CT : General Intelligence and Reasoning (Practice Set) 10 Questions 20 Marks 8 Mins GIVEN: A sum of money doubles itself in 7 years. CONCEPT: Simple interest concept. FORMULA USED: SI = (PRT/100) Where, P = Principal, R = Rate, T = Time CALCULATION: Suppose Principal = Rs. P, Amount = 2P, Time = 7 and Rate = R% (Suppose) ⇒ SI = 2P – P = Rs. P Now, P = (P × R × 7/100) ⇒ R = 100/7% Now, we want the money to be quadruple i.e. 4 times. ⇒ Amount = 4P and SI = 3P Suppose time = T So, 3P = (P × 100/7 × T)/100 ⇒ T = 21 ∴ The money will quadruple itself in 21 years. Last updated on Nov 16, 2022 The SSC CGL Application Status for KKR Region is active now! Candidates can from the KKR can log in to the regional website of SSC and check their application status. SSC CGL 2022 Tier I Prelims Exam Date Out on the official website of SSC on 31st October 2022. The prelims exam will be conducted from 1st to 13th December 2022. Earlier, SSC CGL Results for Tier II 2021 Marks Status Link has been activated.Candidates can check their marks by visiting the official website. The SSC CGL 2022 is ongoing and the candidates had applied for the same till 13th October 2022. The SSC CGL 2022 Notification was out on 17th September 2022. The SSC CGL Eligibility is a bachelor’s degree in the concerned discipline. This year, SSC has completely changed the exam pattern and for the same, the candidates must refer to SSC CGL New Exam Pattern. Ace your Interest preparations for Simple Interest with us and master Quantitative Aptitude for your exams. Learn today! Answer Verified
Hint:- In 8 years money from Interest will be come equal to the principal Let the initial amount of money invested will be Rs. x. So, now we will use a simple interest formula. So, putting the values in the above formula. We will get, Hence, the rate of interest to double a money in 8 years will be 12.5% per annum. Note:- Whenever we came up with this type of problem where we are asked
to Solution : Given:<br>Time Period (t)`=3` years<br>Let the Principal (P) be `Rs.100`<br>Then the Amount (A) will be `Rs.200` as given in the question that the money will be doubled.<br>And let the rate be R.<br>As we know that:<br>`A=P(1+R/100)^t`<br>`therefore 200=100(1+R/100)^3`<br>`200/100=((100+R)/100)^3`<br>`2=((100+R)/100)^3`<br>`root(3)(2)=(100+R)/100`<br>`1.2599=(100+R)/100`<br>`1.2599times100=100+R`<br>`125.99=R+100`<br>`R=125.99-100`<br>`R=25.99%` per annum.<br>Hence, the rate at which sum of money is doubled in `3` years is `25.99%` per annum. Double Your Money: The Rule of 72The Rule of 72 is a quick and simple technique for estimating one of two things:
The rule states that an investment or a cost will double when: [Investment Rate per year as a percent] x [Number of Years] = 72. When interest is compounded annually, a single amount will double in each of the following situations:  The Rule of 72 indicates than an investment earning 9% per year compounded annually will double in 8 years. The rule also means if you want your money to double in 4 years, you need to find an investment that earns 18% per year compounded annually. You can confirm the rationality of the Rule of 72 as follows: Find factors on the FV of 1 Table that are close to 2.000. (The factor of 2.000 tells you that the present value of 1.000 had doubled to the future value of 2.000.) When you find a factor close to 2.000, look at the interest rate at the top of the column and look at the number of periods (n) in the far left column of the row containing the factor. Multiply that interest rate times the number of periods and you will get the product 72. To use the Rule of 72 in order to determine the approximate length of time it will take for your money to double, simply divide 72 by the annual interest rate. For example, if the interest rate earned is 6%, it will take 12 years (72 divided by 6) for your money to double. If you want your money to double every 8 years, you will need to earn an interest rate of 9% (72 divided by 8). Here's another way to demonstrate that the Rule of 72 works. Assume you make a single deposit of $1,000 to an account and wish for it to grow to a future value of $2,000 in nine years. What annual interest rate compounded annually will the account have to pay? The Rule of 72 indicates that the rate must be 8% (72 divided by 9 years). Let's verify the rate with the format we used with the FV Table: To finish solving the equation, we search only the "n = 9" row of the FV of 1 Table for the FV factor that is closest to 2.000. The factor closest to 2.000 in the row where n = 9 is 1.999 and it is in the column where i = 8%. An investment at 8% per year compounded annually for 9 years will cause the investment to double (8 x 9 = 72). |
At what rate will a sum double itself in 7 years if the interest is compounded annually
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