If 2,000 is invested at a simple interest rate of 5% per annum and the interest is added to the principal after 10 years, then in how many years will it amount to 4,000 at the same rate of interest?
Show answer & explanation
Correct answer: C
Explanation
The correct answer is option 3 i.e. years.
SI earned after 10 years = (P × R × T)/100 = (2000 × 5 × 10)/100 = 1000
Current principal = 2000 + 1000 = 3000
Required interest = 4000 - 3000 = 1000
Time required = (SI × 100)/(P × R) = (1000 × 100)/(3000 × 5) = 20/3 years
Total time required = 10 + (20/3) = years