A sum of money doubles itself in 5 years at compound interest. In how many years will it become 8 times? Options 10 years 20 years 15 years 25 years
Question
A sum of money doubles itself in 5 years at compound interest. In how many years will it become 8 times?
Options
- 10 years
- 20 years
- 15 years
- 25 years
Solution
The problem states that the sum of money doubles itself in 5 years. This means that it becomes 2 times the original amount in 5 years.
We need to find out when it will become 8 times the original amount.
Since 8 is 2^3, we can say that the money will become 8 times the original amount in 3 intervals of 5 years (because it doubles every 5 years).
So, the money will become 8 times the original amount in 3*5 = 15 years.
Therefore, the correct option is 15 years.
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