A sum of money becomes double in 5 years at compound interest. Find the rate of interest.
Correct: B
Let the principal amount be P and the rate of interest be R. We are given that the amount becomes double in 5 years, which means the amount after 5 years is 2P. The compound interest is given by the formula A = P(1 + R/100)^T, where A is the amount, P is the principal amount, R is the rate of interest, and T is the time in years. Substituting the values, we get 2P = P(1 + R/100)^5, which implies (1 + R/100)^5 = 2. Taking the fifth root of both sides, we get 1 + R/100 = 2^(1/5), which implies R = (2^(1/5) - 1) * 100 ≈ 14.87. However, the closest option to this is 15%.