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# A certain sum of money amounts to $2613 in 6 yrs at 5% per  post reply Question banks Downloads My Bookmarks Reviews Important topics Author Message Manager Joined: 26 Dec 2003 Posts: 227 Location: India Followers: 1 Kudos [?]: 3 [0], given: 0 A certain sum of money amounts to$ 2613 in 6 yrs at 5% per [#permalink]

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19 Feb 2004, 10:04
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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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19 Feb 2004, 10:38
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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19 Feb 2004, 12:33
Rakesh, we need to know if interest is compounded
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Best Regards,

Paul

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19 Feb 2004, 13:03
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$_________________ Best Regards, Paul Last edited by Paul on 19 Feb 2004, 15:53, edited 1 time in total. Intern Joined: 26 Jan 2004 Posts: 35 Location: US Followers: 1 Kudos [?]: 0 [0], given: 0 ### Show Tags 19 Feb 2004, 15:22 2613 = (P+I) Principal and Interest in 6 years at 5% simple interest. Use I = (P.n.R)/100 n -time in years and R-- rate to get P = 2010 New interest for n years = 3015 - 2010 = 1005 n = (I .100)/(P.R) = (1005.100)/(2010.5) = 10 years Manager Joined: 26 Dec 2003 Posts: 227 Location: India Followers: 1 Kudos [?]: 3 [0], given: 0 ### Show Tags 19 Feb 2004, 17:42 Answer is 10 yrs. Guys in every question, u need to assume it as SI unless it specifically says that the interest is compounded. 19 Feb 2004, 17:42 Display posts from previous: Sort by # A certain sum of money amounts to$ 2613 in 6 yrs at 5% per

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