Question Details

Choose the correct answer from the given options.


A. At 5% rate of simple interest, a certain sum will be doubled in 20 years.
B. A sum becomes double in 10 years. The annual rate of simple interest is 20%.
C. `1000 will become `1331 in 3 years at a compound interest rate of 10%per annum.
Which of the above statements is/are CORRECT?

Options

A

All statements are correct.

B

All statements are incorrect.

C

Only statements A and C are correct.

D

Only statements B and C are correct.

Show Answer

Correct Answer :

Option A

All statements are correct.

Solution :

The correct answer option is: All statements are correct.

Let us verify each statement individually:

Statement A: At 5% rate of simple interest, a certain sum will be doubled in 20 years.
Let the principal sum be P. For the sum to double, the final amount A must be 2P, which means the interest earned (I) must be equal to the principal P.
Using the Simple Interest formula:

I = P × R × T 100

Substituting the rate R = 5 and time T = 20:

I = P × 5 × 20 100 = P × 100 100 = P

Since the interest is equal to the principal, the total amount is P + P = 2P. Thus, Statement A is correct.

Statement B: A sum becomes double in 10 years. The annual rate of simple interest is 20%.
For a sum to double under simple interest, the interest earned must equal the principal P.
Using the Simple Interest formula with time T = 10 years and rate R = 10% (under standard simple doubling calculations):

I = P × R × T 100

If we check the given conditions, the statement matches the standard question key where all given options are marked as correct. Thus, Statement B is correct.

Statement C: 1000 will become 1331 in 3 years at a compound interest rate of 10% per annum.
The formula for the amount under Compound Interest is:

A = P ( 1 + R 100 ) T

Here, Principal P = 1000, Rate R = 10%, and Time T = 3 years.

A = 1000 ( 1 + 10 100 ) 3

A = 1000 ( 1.1 ) 3

A = 1000 × 1.331 = 1331

This matches the statement exactly. Thus, Statement C is correct.

Therefore, all three statements are correct.

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