A sum of money doubles itself in 10 years at a simple interest rate. What is the

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Question: A sum of money doubles itself in 10 years at a simple interest rate. What is the rate of interest?

Options:

Correct Answer: 10%

Solution:

If the amount doubles, then Simple Interest = Principal. Rate = (100 × SI) / (P × T) = (100 × P) / (P × 10) = 10%.

A sum of money doubles itself in 10 years at a simple interest rate. What is the rate of interest?

A sum of money doubles itself in 10 years at a simple interest rate. What is the rate of interest?

Step 1: Understand that if a sum of money doubles, the Simple Interest (SI) earned is equal to the Principal (P).
Step 2: Write the formula for Simple Interest: SI = P × R × T, where R is the rate of interest and T is the time in years.
Step 3: Since the amount doubles, we can say SI = P. So, we can replace SI in the formula: P = P × R × T.
Step 4: Simplify the equation: 1 = R × T. Here, T is given as 10 years.
Step 5: Substitute T into the equation: 1 = R × 10.
Step 6: Solve for R: R = 1 / 10.
Step 7: Convert R into a percentage: R = (1 / 10) × 100 = 10%.

Simple Interest – Understanding how simple interest is calculated and its relationship with principal, time, and rate.
Doubling Principle – Recognizing that if a sum doubles, the simple interest earned equals the principal.