Question

Q. Anchal deposits Rs. P with a bank at r% compound interest and sees it reach Rs. 27P in 36 years. If he had invested the same amount at r% simple interest for 25 years, what would be the final amount?2.3P to 2.5P18P to 19P5.6P to 6.1P3.25P to 3.5P

Solution

The correct option is D 3.25P to 3.5PP(1+r)36=27P(1+r)36=27(1+r)123=33(1+r)12=3  In order for the money to triple, the approximate formula for r=115n=11512=9.6 Rate of interest should be roughly 9% -10% If he had invested this in simple interest, A=P+P×25×9to10%100=3.25P to 3.5P

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