Simple Interest – Rate when a sum doubles: At simple interest, a sum doubles itself in 20 years. Find the annual rate of interest (percent per annum).

Introduction / Context:
Doubling under SI means the interest over the period equals the principal. This gives a direct relation between rate and time.

Given Data / Assumptions:

• Doubling time t = 20 years

Concept / Approach:
If A = 2P, SI = P. With SI = P * r * t, we get P = P * r * 20 → r = 1 / 20 = 5% per annum.

Step-by-Step Solution:

Verification / Alternative check:

Why Other Options Are Wrong:

• 10% / 12% / 7.5%: inconsistent with doubling in 20 years under SI.
• Data inadequate: not true; data is sufficient.

Common Pitfalls:

• Treating as compound interest.

Final Answer:
5% per annum.