If Mr Kuber had lent $10 million at an interest rate of
40% p.a. to a less preferred customer Mr Narada, after
how many years would the principal double itself if
compounded half-yearly?
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Answer:
Mr Kuber had lent $10 million at an interest rate of
40% p.a. to a less preferred customer Mr Narada.
Required time to double the amount
Calculate:
Time (t)
Where: t = log(A/P) / n[log(1 + r/n)]
Total P+I (A): $ 20
Principal (P): $ 10
Rate (R): % 40
Compound (n): Compounding Semi-Annually (2/Yr)
Answer:
t = 1.901 years
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