An amount is said to double in 5 years with compound interest. How many years will it take for the amount to grow to 8 times its original value?
A. 15 (Correct answer)
B. 16
C. 17
D. 18
Correct Answer
Option A — 15
Detailed Solution & Explanation
The correct answer is 15.
Key Points
Under compound interest the money doubles every 5 years.
To reach 8 times = 2³, it must double three times, so 3 × 5 = 15 years.
Express the growth factor as a power of the doubling factor (8 = 2³); the number of doublings times the doubling period gives the answer directly, without computing the rate.