Question

A sum of rs 5000 deposited at compound interest becomes double after 5 years .how much will it be after 20 years

Answer 1

The answer maybe 20000

Answer 2

The sum after 20 years is Rs. 1,92,000

Given:

Amount = Rs. 5000

Time = 5 years

To find:

The sum after 20 years

Solution:

Using the formula of compound Interest -

P( 1 + r/100)~n

Substituting the values -

12000 x ( 1 + r/100)~5 = 24000

( 1 + r/100)~5 = 2

After 10 years

[(1 + r/100)~5]~4 = 2~4

( 1 + r/100) ~20 = 16

P ( 1 + r/100)~20

= 16 x P

= 16 x 12000

= 19200

Answer: The sum after 20 years is Rs. 1,92,000

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