Compound Interest Practice Test 4

Question : 22 of 40

Marks: +1, -0

A sum of money placed at compound interest becomes four times itself in 2 years. In how many years will it amount to eight times itself?

Solution:

Here,

4P=P(1+r/100)^2

∴(1+r/100)=2

...(i)
Now,

8P=P(1+r/100)^n

⇒(1+r/100)^n=2^3=(1+r/100)^3

[from equation (i)]
Hence, n = 3 years

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