A sum of money invested at 5% per annum simple interest amounts to $285.20 after 3 years. How long will it take the same sum to amount to $434.00 at 7\(\frac{1}{2}\)% per annum simple interest?
 

  • A 7\(\frac{1}{2}\) years
  • B 10 years
  • C 5 years
  • D 12 years
  • E 14 years
jamb 1981mathematics

The correct answer is B. 10 years

Let’s say the initial sum of money is P. 

Since the sum of money invested at 5% per annum simple interest amounts to $285.20 after 3 years, we can write an equation for P using the formula for simple interest: P + P * 0.05 * 3 = 285.20. Solving for P, we get P = 220.

Now, we want to find out how long it will take for this sum of money to amount to $434.00 at 7.5% per annum simple interest. 

Let’s say it takes t years. Using the formula for simple interest, we can write an equation for t: 220 + 220 * 0.075 * t = 434. 

Solving for t, we get t = 10. So, it will take 10 years for the same sum to amount to $434.00 at 7.5% per annum simple interest.

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