- #1
zak100
- 462
- 11
Homework Statement
An investment is made at 12.5% annual simple interest. Find the number of years it will take for the cumulative value of the interest to equal the original investment?
Homework Equations
V=P(1+rt)
Where V= interest on Amount
P = Principal amount
r= interest rate
t= number of years for which amount is invested
The Attempt at a Solution
Simple Interest formula is:
V=P(1+rt) Let p =10 & t=1
V= 10(1+12.5) = 135In just one year the interest obtained is more than the Principal value. Some body please guide me. What I understand is that, I have to find the number of years in which the interest obtained & added (with previous years’ interest becomes equal to the Principal).
Zulfi.