A sum of money becomes 3 times in 5 years at simple interest

A sum of money becomes 3 times in 5 years at simple interest. In how many years will the same sum become 6 times at the same rate of simple interest?

  1. 10.5 years
  2. 12 years
  3. 12.5 years
  4. 10 years

Answer

Let principal amount be ₹ P and rate of interest be R per annum. Time of investment is 5 years.

So, first we need to find R such that

P × (1+5R) = 3 × P

⇨ 1 + 5R = 3

⇨ R = 2/5 = 0.4 or 40%

Now, we need to find the number of years T such that,

P × (1 + 0.4T) = 6 × P

1 + 0.4T = 6

0.4T = 5

T = 5/0.4 = 25/2 = 12.5

The correct option is C.