Question

At what simple interest rate per annum will a principal double itself in 5 years?

• A. 20

Answer 1

The correct option is A 20
Time period = 5 years
Let the principal = P
Simple interest rate = R% p.a.
Pricipal doubles in 5 years, so amount after 5 years will be 2P.

Simple interest = Amount - Principal
Simple interest = 2P - P = P
Simple interest = $\frac{PRT}{100}$
P = $\frac{P\times R\times 5}{100}$
R = 20%