In what time will compound interest at 15% pa be greater than simple interest at 30% pa for the saame principal
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CA = P ( 1 + 0.15 )^n total sum at compound interest
Compound interest CI = CA - P
SA = P (1 + n 0.30) total sum at simple interest
Simple interest = SI = P n 0.30
CI = SI when
P[ (1.15)^n - 1 ] = P n 0.30 => 1.15^n = 1 + 0.3 n
1.15^9 < 3.7 but 1.15^10 > 4
=> ANSWER nearly 10 years
Compound interest CI = CA - P
SA = P (1 + n 0.30) total sum at simple interest
Simple interest = SI = P n 0.30
CI = SI when
P[ (1.15)^n - 1 ] = P n 0.30 => 1.15^n = 1 + 0.3 n
1.15^9 < 3.7 but 1.15^10 > 4
=> ANSWER nearly 10 years
Anonymous:
Thanks. I am more interested to know how to find n=10 without resorting to hit and trial method of substitutig different values for n.
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