Mithali has an initial investment of ₹10 lakh in an investment plan. After 7 years it has grown to ₹ 16 lakh. The rate of return for the period is :
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → 60%
The compound interest,
$A=P(1+r)^t$
$⇒(\frac{A}{P})=(1+r)^t$
$⇒(\frac{16}{10})=(1+r)^7$
$⇒1.6=(1+r)^7$
$⇒1+r=(1.6)^{\frac{1}{7}}$
$⇒r=60\%$