In how many full years will the sum of money become more than double at the compound interest rate of 20% per annum?

Given: Rate of interest is 20%.

To find: Here we have to find number of years taken by a sum of money to become more than double at the compound interest rate of 20% per annum.

Solution:

Let principal amount be = P

Hence,

Amount (A) = 2P

Given rate of interest, R = 20% p.a:

$A\ =\ P\left( 1\ +\ \frac{R}{100}\right)^{n}$

Now,

$2P\ < \ P\left( 1\ +\ \frac{20}{100}\right)^{n}$

$2\ < \ ( 1\ +\ 0.2)^{n}$

$2\ < \ ( 1.2)^{n}$

This is possible only when n = 4.

Thus in 4 years, the sum of money becomes more than double.

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Updated on: 10-Oct-2022

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