In 40 years an amount becomes 6 times the original amount. What is the rate of interest?
A)12.5%
B)24%
C)6.67%
D)34%

Question

Quizplus · Accepted Answer

The amount becomes 6 times the original amount in 40 years, which means the interest earned is 5 times the original amount (since 6 times includes the original amount itself). Using the simple interest formula, where interest = principal × rate × time, and knowing that the interest is 5 times the principal over 40 years, we can set up the equation 5 = 40 × rate. Solving for rate gives us 5/40 = 1/8 = 12.5%.

In 40 Years an Amount Becomes 6 Times the Original