1.

Rama invested in an insurance scheme under which money grows to 1331/1000 in three years at compounded annual basis. If Rama interested to triple his investment using same rate of interest but at simple interest rate basis, then find how time it will take?1). 23 years2). 17 years3). 10 years4). 5 years

Answer»

<P>Let the rate of interest be‘r %’

Money grows to 1331/1000 in three years at compounded annual basis

⇒ (1 + r %)3 = 1331/1000

⇒ (1 + r %)3 = (11/10)3

⇒ (1 + r%) = (11/10)

⇒ 1 + r% = 1.1

⇒ r = 10 %

Let it take ‘t’ years for amount ‘p’ to BECOME ‘3p’ at 10% interest rate

⇒ 3p = p + (p × r × t) /100

⇒ 2p = (p × 10 × t) /100

⇒ t = 20

∴ It will take 20 years for amount to triple.


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