At what rate of SI a sum of money double itself in 5 years?
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Answer:
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Question
Find the rate of interest if a sum doubles itself in 5 years by simple interest.
25%
15%
28%
20%
Answer (Detailed Solution Below)
Option 4 : 20%
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Detailed Solution
Given:
If a sum doubles itself in 5 years by simple interest.
Time (T) = 5 years
Formula used:
S.I. = (P × R × T)/100
Where,
S.I. → Simple Interest
P → Principal
R → Rate
T → Time
Calculations:
Let P be the principal amount and R be the rate of interest.
According to the question,
2P = P + (P × R × T)/100
⇒ P = (P × R × 5)/100
⇒ 1 = (R × 5)/100
⇒ R = 20%