A man invested $p in a long term investment plan for 24 years at an interest which is compounded annually. Due to some financial crisis he had to withdraw money at the end of 6 years. How much more amount could he have gotten after 24 years if he received $3p after 6 years? (note: there were no other charges or deductions in the plan)
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This question is tricky at first since we don't know the compounding interest rate, and feels like perhaps we would need a compound interest formula to solve, but let's consider.
It started at P and then compounded 6 times and tripled itself to 3P. So this is more like a Geometric sequence question!
The rule is "P triples every 6 years."
Year 1 - P
Year 6 - 3P
Year 12 - 9P
Year 18 - 27P
Year 24 - 81P
How much more means we subtract 3P from 81P:
81P-3P = 78P
Step-by-step explanation:
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