Question

The least number of complete years in which a sum of money put out at 20%per annul, the interest being payable half yearly,will be

Answer 1

planation :

Let principal be P

P(1+R100)T>2PP(1+20100)T>2P(1+20100)T>2(120100)T>21.2T>2P(1+R100)T>2PP(1+20100)T>2P(1+20100)T>2(120100)T>21.2T>2

Now let's find out the minimum value of T for which the above equation becomes true

If T = 1, 1.2T = 1.21 = 1.2

If T = 2, 1.2T = 1.22 ≈ 1.4

If T = 3, 1.2T = 1.23 ≈ 1.7

If T = 4, 1.2T = 1.24 ≈ 2.07 which is greater than 2

Hence T = 4

i.e., required number of years = 4