A sum becomes 5 times of itself in 3 years at compound interest (interest is compounded annually). In how many years will the sum becomes 125 times of itself?
Show answer & explanation
Correct answer: A
Explanation
The correct answer is option 1 i.e. 9
Let principal be P rs.
P(1 + R/100)3 = 5P
(1 + R/100)3 = 5
(1 + R/100) = 51/3 ...... (1)
Let the amount after T years be 125P
P(1 + R/100)T = 125P
Substituting the (1) in above equation
(51/3)T = 125
5T/3 = 51/3
T/3 = 1/3
T = 9 Years.