Multiple choice

There is 200% increase in an amount in 16 years, at S.I. What will be the C.I. (approx.) of Rs. 16,000 after 4 years at the same rate of interest?

  1. Rs. 8629

  2. Rs. 9269

  3. Rs. 9629

  4. Rs. 9692
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

200% increase means SI = 2P in 16 years. 2P = P * R * 16 / 100 => R = 12.5%. CI on 16000 at 12.5% for 4 years = 16000 * (1.125)^4 - 16000 = 16000 * 1.6018 - 16000 = 25628.8 - 16000 = 9628.8, approx 9629.

AI explanation

A 200% increase in simple interest over 16 years means the annual interest rate is 200 divided by 16, which is 12.5% per annum. Using the compound interest formula, the amount on Rs. 16000 for 4 years is 16000 times 1.125 to the power of 4, yielding approximately Rs. 25629. Subtracting the principal of Rs. 16000 gives a compound interest of approximately Rs. 9629.

Keep practicing — related questions