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If one invests Rs. 10,000 in a bank at a rate of interest 8% per annum, how long does it take to double the money by compound interest? [(1.08)5 = 1.47] - Mathematics and Statistics

Sum

If one invests Rs. 10,000 in a bank at a rate of interest 8% per annum, how long does it take to double the money by compound interest? [(1.08)5 = 1.47]

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Solution

Amount invested = Rs. 10000

Interest rate = `8/100` = 0.08

amount after 1st year = 10000 (1 + 0.08)

= 10000 (1.08)

Value of the amount after n years

= 10000 (1.08)n

= 20000

∴ (1.08)n = 2

(1.08)5 = 1.47     ...[Given]

∴ n = 10 year. (approximately)

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