An investment doubles in 3 years with simple interest. What is the final amount on 1000?

An investment doubles in 3 years with simple interest. What is the final amount on 1000?

• A. 1000
• B. 1500
• C. 2000
• D. 2500

Answer: (C)

With simple interest, the amount after t years is A = P(1 + rt), since each year’s interest is on the original principal P. Doubling means A = 2P. So 2P = P(1 + rt) → 2 = 1 + rt → rt = 1. The time is 3 years, so r = 1/3 per year. Then the final amount is A = P(1 + rt) = 1000(1 + 1) = 2000. The investment earns 1000 in interest over the 3 years, totaling 2000.

With simple interest, the amount after t years is A = P(1 + rt), since each year’s interest is on the original principal P.

Doubling means A = 2P. So 2P = P(1 + rt) → 2 = 1 + rt → rt = 1. The time is 3 years, so r = 1/3 per year.

Then the final amount is A = P(1 + rt) = 1000(1 + 1) = 2000. The investment earns 1000 in interest over the 3 years, totaling 2000.