Compound Interest - Quantitative Aptitude (MCQ) questions for Q. 21144

Q.  Rohit invests a sum of money at compound interest which doubles itself in 3 years, find in how many years will it amount to four times itself ?
- Published on 22 Apr 16

a. 4
b. 6
c. 10
d. 14
e. None of these

ANSWER: 6
 
Case (I) When Time (T) = 3 years, principle P becomes 2P.
Therefore, amount = 2P
A = P (1 + R/100)T
2P = P (1 + R/100)3
(1 + R/100)3 = 2
(1 + R/100) = 3√2 -------- (A)
(III) Find T for which P becomes 4P
When Time = X and Amount = 4P
4P = P (1 + R/100)X
(1 + R/100)X = 4
(1 + R/100) = 41/X --------- (B)
Equating (A) and (B) we get,
41/X = 3√2 = 21/3
22/X = 21/3
2/X = 1/3
X = 6 years

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