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Re: Shaun invests a certain sum of money at 18.75% p.a. simple interest. [#permalink]

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19 Aug 2015, 22:59

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Bunuel wrote:

Shaun invests a certain sum of money at 18.75% p.a. simple interest. After how many years will the sum of money become three times its principal?

A. 10 years, 6 months, 20 days B. 10 years 8 months C. 10 years 9 months D. 12 years E. 16 years

Ans: B Solution: simple interest question

B=A[1+ (tr/100)]; where A is principal amount, B final amount, t time in years and r interest rate after putting the values 18.75= 75/4

3= [1+(75t/400)] t= 32/3 which is (30+2)/3= 10 + 2/3 means 10 years and (12*2)/3 = 8 months. total time 10 years 8 months
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Re: Shaun invests a certain sum of money at 18.75% p.a. simple interest. [#permalink]

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19 Aug 2015, 23:11

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AnkitaAnkita wrote:

You have wrongly used CI formula for SI.

you used formula for interest only : question is asking about total sum of money. so formula is

Final sum = Initial amount [ 1 + tr/100 ]
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Re: Shaun invests a certain sum of money at 18.75% p.a. simple interest. [#permalink]

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19 Aug 2015, 23:30

AnkitaAnkita wrote:

Yep sorry!

Lesson learnt Read properly

Yes and one more thing the interest formula you used is also wrong as in you shouldn't use it this way because it makes you prone to making mistakes.

just use Interest = (amount* rate)/100 and you multiply with time in later part so that you don't get confused and use it wrongly. just an advice.

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Re: Shaun invests a certain sum of money at 18.75% p.a. simple interest. [#permalink]

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19 Aug 2015, 23:35

dkumar2012 wrote:

AnkitaAnkita wrote:

Yep sorry!

Lesson learnt Read properly

Yes and one more thing the interest formula you used is also wrong as in you shouldn't use it this way because it makes you prone to making mistakes.

just use Interest = (amount* rate)/100 and you multiply with time in later part so that you don't get confused and use it wrongly. just an advice.

Thumbs UP

Sure thing. I did not understand how i can use it wrongly. But will be cautious . Thanks.

P.S: The formula is right but the steps followed may take me down. And just to tell you: When you are an engineer ,you don't focus on the formulas , just use it like a key to the answer choice. You become quick in putting everything together . perhaps , that is the bad habit.

Re: Shaun invests a certain sum of money at 18.75% p.a. simple interest. [#permalink]

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19 Aug 2015, 23:41

1

This post received KUDOS

AnkitaAnkita wrote:

Sure thing. I did not understand how i can use it wrongly. But will be cautious . Thanks.

P.S: The formula is right but the steps followed may take me down. And just to tell you: When you are an engineer ,you don't focus on the formulas , just use it like a key to the answer choice. You become quick in putting everything together . perhaps , that is the bad habit.

Unfortunately or Fortunately I am an engineer too.

I used to do the same mistake but now I take my time because 10 seconds can make difference.
_________________

-------------------------------------------------------------------- The Mind is Everything, What we Think we Become. Kudos will encourage many others, like me. Please Give Kudos !! Thanks

Re: Shaun invests a certain sum of money at 18.75% p.a. simple interest. [#permalink]

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19 Aug 2015, 23:47

1

This post received KUDOS

dkumar2012 wrote:

AnkitaAnkita wrote:

Sure thing. I did not understand how i can use it wrongly. But will be cautious . Thanks.

P.S: The formula is right but the steps followed may take me down. And just to tell you: When you are an engineer ,you don't focus on the formulas , just use it like a key to the answer choice. You become quick in putting everything together . perhaps , that is the bad habit.

Unfortunately or Fortunately I am an engineer too.

I used to do the same mistake but now I take my time because 10 seconds can make difference.

Re: Shaun invests a certain sum of money at 18.75% p.a. simple interest. [#permalink]

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20 Aug 2015, 06:01

1

This post received KUDOS

2

This post was BOOKMARKED

Bunuel wrote:

Shaun invests a certain sum of money at 18.75% p.a. simple interest. After how many years will the sum of money become three times its principal?

A. 10 years, 6 months, 20 days B. 10 years 8 months C. 10 years 9 months D. 12 years E. 16 years

Kudos for a correct solution.

Let 100 be the principal You have to earn 200 as interest Divide 200 by 18.75 to get the number of years (10 and 2/3; 2/3 is 8 months) It is 10 years and 8 months.

Re: Shaun invests a certain sum of money at 18.75% p.a. simple interest. [#permalink]

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Shaun invests a certain sum of money at 18.75% p.a. simple interest. [#permalink]

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07 Sep 2017, 01:00

Bunuel wrote:

Shaun invests a certain sum of money at 18.75% p.a. simple interest. After how many years will the sum of money become three times its principal?

A. 10 years, 6 months, 20 days B. 10 years 8 months C. 10 years 9 months D. 12 years E. 16 years

Kudos for a correct solution.

Basically, the sum of the money gathered with the interest must be 200 usd.

If we consider the principal to be 100 usd, we'll quickly realize that options D and C are wrong. Now in one year we'll get an interest of 100 * 0,1875 = 18,75. In 10 years we'll have 187.5 Obviously, in 11 years we'll have more than 200 usd, thus the previous paragraph.

We need 12,5 usd. Now, if we're used to do mental calculation, we'll quickly realize that 18/3 + 0,75/3 = 6 + 0,25 = 6,25. And 6,25*2 = 12,5 -> 2/3 of 18,75, which is what we get in 1 year, hence we'll need 2/3 of a year, which is answer b) -> 8 months.

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