Question

How long will an amount of money double at a simple interest rate of $2$ percent per annum?

Answer 1

Calculate the time :

Let $P$be the principal amount of money.

Given that the rate of simple interest is $2\%,$i.e.$R=2\%$

Let us assume that in $T$ years, the principal amount doubles.

Using the formula of simple interest, we have:

$$\begin{gathered} 2P=P+\frac{2\times P\times T}{100}\mathbf{}\left[\because Simpleinterest=\frac{P\times R\times T}{100}\right] \\ \Rightarrow 2P–P=\frac{2\times P\times T}{100} \\ \Rightarrow P=\frac{P\times T}{50} \\ \Rightarrow T=50 \end{gathered}$$

Therefore, it will take $50$years to get the double amount at a simple interest rate $2\%$ per annum.