  Question

# Amit invests in Fund A in which a sum of money doubles itself in two years. Arjun invests in Fund B in which a sum of money triples itself in four years. Which of the following statements are correct?Arjun's investment is better than that of Amit's .Amit's investment is better than that of Arjun's.Both the investments are equally good.None of the above

Solution

## The correct option is C Both the investments are equally good.Fund A: Given, time = 2 years. Let the sum invested be ₹ 100. So, the Amount received after two years = ₹ 200. We know that, Principal + Interest = Amount. Hence, Interest = Amount - Principal = ₹ (200-100) = ₹ 100. The Simple Interest earned on a sum of ₹ P for a period of T years at the rate of R% p.a S.I is given by P× R× T100. So, ₹ 100 = 100× R× 2100 Hence, R = 50%. Fund B : Given, time = 4 years. Let the sum invested be ₹ 100. So, the Amount received after 4 years = ₹ 300. We know that, Principal + Interest = Amount. Hence, Interest = Amount - Principal = ₹ (300-100) = ₹ 200. The Simple Interest earned on a sum of ₹ P for a period of T years at the rate of R% p.a S.I is given by P× R× T100. So, ₹ 200 = 100× R× 4100 Hence, R = 50%. Since, the rate of interest provided in both the funds are equal, Both the investments are equally good.  Suggest corrections   