Multiple choice

At what rate percent (simple interest) will a sum of money double itself in 16 years?

  1. $6\frac {1}{4}$%
  2. $5\frac {1}{4}$%
  3. $5\frac {3}{4}$%
  4. $6\frac {3}{4}$%
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A Correct answer
Explanation

Simple interest I = P. I = P*R*T/100. P = P*R*16/100. 1 = 16R/100. R = 100/16 = 6.25 = 6 and 1/4%.

AI explanation

For a sum to double itself at simple interest, the interest earned must equal the principal, meaning the time in years is 100 divided by the rate. Setting 16 equal to 100 divided by R, we solve for R to get R equals 100 divided by 16. This yields 6.25%, which is equivalent to 6 and one quarter percent.

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