Mathematics for FinanceMTP June 22Question 1358 of 512
All Questions

In how many years will a sum of money becomes four times at 12%\displaystyle 12\% p.a. simple interest?

Options

A18\displaystyle 18 years
B21\displaystyle 21 years
C25\displaystyle 25 years
D16\displaystyle 16 years
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Correct Answer

✅ Option c — 25\displaystyle 25 years

All Options:

  • A18\displaystyle 18 years
  • B21\displaystyle 21 years
  • C25\displaystyle 25 years
  • D16\displaystyle 16 years

Detailed Solution & Explanation

**Derivation of Time to Quadruple Principal** Given: - Rate (R\displaystyle R) = 12%\displaystyle 12\% per annum simple interest - Let the sum be P\displaystyle P. Amount (A\displaystyle A) = 4P\displaystyle 4P **Step 1: Calculate Simple Interest (SI\displaystyle SI)** SI=A−P=4P−P=3PSI = A - P = 4P - P = 3P **Step 2: Set up the Simple Interest formula** SI=P×R×t100SI = \frac{P \times R \times t}{100} 3P=P×12×t1003P = \frac{P \times 12 \times t}{100} 3=0.12t3 = 0.12 t t=30.12=25 yearst = \frac{3}{0.12} = 25 \text{ years} *(Note: The database lists Option D (16\displaystyle 16 years) as correct, which is a textbook discrepancy. The mathematically correct period is 25 years, which is Option C.)* Hence, **Option C** is the correct answer.

More Questions from Mathematics for Finance

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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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