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A certain sum of money amounts to $ 2613 in 6 yrs at 5% per

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A certain sum of money amounts to $ 2613 in 6 yrs at 5% per [#permalink] New post 19 Feb 2004, 09:04
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A certain sum of money amounts to $ 2613 in 6 yrs at 5% per annum. In how many yrs will it amount to $ 3015 at the same rate?
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 [#permalink] New post 19 Feb 2004, 09:38
10 years from the begining of the investment ( assuming simple interest not added vto the sum every year )
or 4 years from the time it became 2613
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 [#permalink] New post 19 Feb 2004, 11:33
Rakesh, we need to know if interest is compounded
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 [#permalink] New post 19 Feb 2004, 12:03
The best way to go about this problem is to work in approximation. A quick way to calculate a 5% interest rate is just calculate it as being 10% and divide the result by 2.
After 1 year, then .05 * 2613 = approx. 130$
After 1 year, total amount in piggy bank is 2600 + 130 = 2730

After 2nd year, if interest is compounded, interest earned is .05 * 2730 = approx. 140$
After 2nd year, total amount in piggy bank is 2730 + 140 = 2870

After 3rd year, interest earned is .05 * 2870 = approx. 145
After 3rd year, total amount in piggy bank is 2870 + 145 = 3015

Eureka, answer is 3 years. I think we have to assume compounding in this problem. You then have to add 3 + 6 = 9years to become 3015$
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Last edited by Paul on 19 Feb 2004, 14:53, edited 1 time in total.
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 [#permalink] New post 19 Feb 2004, 14:22
2613 = (P+I) Principal and Interest in 6 years at 5% simple interest.
Use I = (P.n.R)/100 n -time in years and R-- rate to get P = 2010

New interest for n years = 3015 - 2010 = 1005
n = (I .100)/(P.R)
= (1005.100)/(2010.5)
= 10 years
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 [#permalink] New post 19 Feb 2004, 16:42
Answer is 10 yrs. Guys in every question, u need to assume it as SI unless it specifically says that the interest is compounded.
  [#permalink] 19 Feb 2004, 16:42
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A certain sum of money amounts to $ 2613 in 6 yrs at 5% per

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