in how many minimum number of complete years, a sum of money put out at 25percent compound interest will be more than double?
Answer (1)
1st Jun, 2020
Hello !
The basic formula for calculating amount computed manually is
A = P(1+r/100)^n +P where , A= amount , P= Principal , r = rate of interest and n is no of years .
Now , if r=25% then ,
A= P(1+1/4)^n +P
A=P(5/4)^n+P
And , you want that it should be more than double which means ,
P(5/4)^n+P > 2
hence , we should lookout that when (5/4)^n >2 and for n=4 it is greater than 2 , hence the answer is 4.
Hope it helps!
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