Mathematics of FinanceMCQPYQ May 20Question 1307 of 512
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What time will be required for a sum of money to double itself at 8%\displaystyle 8\% Simple interest?

Options

A8\displaystyle 8 years
B8.5\displaystyle 8.5 years
C12.5\displaystyle 12.5 years
D12\displaystyle 12 years
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Correct Answer

✅ Option c — 12.5\displaystyle 12.5 years

All Options:

  • A8\displaystyle 8 years
  • B8.5\displaystyle 8.5 years
  • C12.5\displaystyle 12.5 years
  • D12\displaystyle 12 years

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Detailed Solution & Explanation

**Derivation of Time to Double Sum** Given: - Rate of Interest (R\displaystyle R) = 8%\displaystyle 8\% per annum - Let the sum be P\displaystyle P. Amount (A\displaystyle A) = 2P\displaystyle 2P **Step 1: Calculate Simple Interest (SI\displaystyle SI)** SI=A−P=2P−P=PSI = A - P = 2P - P = P **Step 2: Set up the Simple Interest formula** SI=P×R×t100SI = \frac{P \times R \times t}{100} P=P×8×t100P = \frac{P \times 8 \times t}{100} 1=8t1001 = \frac{8 t}{100} 8t=100  ⟹  t=1008=12.5 years8 t = 100 \implies t = \frac{100}{8} = 12.5 \text{ years} Hence, **Option C** is the correct answer.

About This Chapter: Mathematics of Finance

Paper

Paper 3: Quantitative Aptitude

Weightage

12-16 Marks

Key Topics

Simple & Compound Interest, Annuity, Perpetuity

The most important mathematical chapter in the entire syllabus. It covers Simple Interest (SI), Compound Interest (CI), Nominal vs Effective rates, Present and Future Value, Annuities (Ordinary and Due), Sinking Funds, and Perpetuities. The concepts learned here are applied heavily in CA Intermediate and Final.

View Official ICAI Syllabus

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Guaranteed 12-16 marks. Master your calculator! Learn the 'GT' and compound interest M+/M- tricks to solve annuity questions in 10 seconds without writing long formulas.

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A certain sum of money was put at S.I. for 2.5\displaystyle 2.5 years at a certain rate of S.I. p.a. Had it been put at 4%\displaystyle 4\% higher rate, it would have fetched 500\displaystyle 500 more. Find the sum of money.

Rs.1,25,000\displaystyle 1,25,000 is borrowed at compound interest at the rate of 2%\displaystyle 2\% for the 1st year, 3%\displaystyle 3\% for the second year and 4%\displaystyle 4\% for the 3rd year. Find the amount to be paid after 3 years.

If Rs. 1,000\displaystyle \text{Rs. }1,000 be invested at interest rate of 5%\displaystyle 5\% and the interest be added to the principal every 10\displaystyle 10 years, then the number in years in which it will amount to Rs. 2,000\displaystyle \text{Rs. }2,000 is:

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