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Worked Examples · Example 3

Q.In how many years will a sum of money double itself at 8% per annum simple interest?

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✓ Free question

Given: R=8%R = 8\% p.a.; the sum is to double, i.e. amount A=2PA = 2P, so the interest must equal the principal, SI=A−P=PSI = A - P = P.

Method 1 — set SI=PSI = P.

P×R×T100=P  ⇒  P×8×T100=P.\dfrac{P \times R \times T}{100} = P \;\Rightarrow\; \dfrac{P \times 8 \times T}{100} = P.

Dividing both sides by PP (the principal cancels, so the answer does not depend on the sum): 8T100=1\dfrac{8T}{100} = 1, hence T=1008=12.5T = \dfrac{100}{8} = 12.5 years.

Method 2 — independent check with a specific sum. Take any sum, say ₹1,000. To double it the interest must be ₹1,000. At 8% the yearly interest is ₹80, so the time needed is 100080=12.5\dfrac{1000}{80} = 12.5 years — the same answer, and it would be the same for any starting sum.

✓Final answer

A sum doubles itself in 12.5 years at 8% per annum simple interest.

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