Compound Interest Practice Test 5

Question : 38 of 40

Marks: +1, -0

A sum of money at compound interest becomes

3/ 2

times of itself in 2 years, In how many years will it become

81/ 16

times of itself compounded annually?

Solution:

Let the sum invested = Re 1

3/2=1(1+r/100)^2

Squaring both sides,

9/4=1(1+r/100)^4

Again squaring both sides,

81/16=1(1+r/100)^8

So, in 8 years, it becomes

81/ 16

times of itself at compound interest.

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