How long {in years} will a sum of money invested at 6% per annum simple interest to increase its value by 40%?
Show answer & explanation
Correct answer: A
Explanation
The correct answer is option 1 i.e. 6
Given that
The rate of simple interest = 6% p.a.
Increase in value by 40%
Formula used
S.I. = Principal × rate × time/100
Amount = Principal + S.I.
Let the Principal be 100X
Amount = 100X + 100X × 6 × time/100
⇒ 140X = 100X + 100X × 6 × time/100
⇒ 40X = 6X × time
time = 40/6 = 6 years