Question

A sum of money becomes triple of itself in 10 years at the rate of simple interest, find the annual rate of interest.

A. 5%

B. 8%

C. 10%

D. 20%

1. D
2. B
3. C
4. A

Answer 1

Correct Answer - Option 1 : D

Given:

Time = 10 years

Money triple in 10 years.

Formula used:

Simple interest = (P × R × T)/100

Where P → Principal

T → Time

R → Rate

Calculation:

Let the principal be 'x'.

So, Amount = 3x

Simple interest = 2x

Simple interest = (P × R × T)/100

⇒ 2x = (x × R × 10)/100

⇒ R = (2 × 100)/10

⇒ R = 20%

∴ The annual rate of interest is 20%.