Practicing Success

Target Exam

CUET

Subject

General Test

Chapter

Numerical Ability

Topic

Compound Interest

Question:

If a sum on compound interest (compounded yearly) becomes three times in 4 years, then with the same interest rate, the sum will become 81 times in:

Options:

12 years

18 years

15 years

16 years

Correct Answer:

16 years

Explanation:

We know ,

Amount = Principal × ( 1 + \(\frac{rate }{100}\) )t

Let principal = P

3P = P × ( 1 + \(\frac{rate }{100}\) )4

3 =  ( 1 + \(\frac{rate }{100}\) )4   --------(1)

Now,

After t years sum becomes 81 times of itself.

81P = P × ( 1 + \(\frac{rate }{100}\) )t

34 = P × ( 1 + \(\frac{rate }{100}\) )t

Using equation 1 ,

( 1 + \(\frac{rate }{100}\) )16 =   ( 1 + \(\frac{rate }{100}\) )t

So , t = 16 years