A sum of money doubles in 10 years at simple interest. What is the rate of interest per annum?
Show answer & explanation
Correct answer: C
Explanation
Given:
Time = 10 years
Amount doubles
By the formula:
SI = (P × R × T) / 100
A = P + SI
Amount doubles ⇒ A = 2P
SI = A − P
SI = 2P − P
SI = P
P = (P × R × 10) / 100
I = (R × 10) / 100
R = 10
Annual interest rate = 10%