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A lady invested ₹ 10,000 in a mutual fund and the value of investment at the time of redemption was ₹ 20,000. If the compound annual growth rate (CAGR) for this investment is 25.9 %, then the number of years for which she has invested the amount is:-

[Given that : 21/3≈1.2592^{1/3}\approx 1.259 ]

Solution

✅ Correct Option: 1

CAGR satisfies (2000010000)1/n−1=0.259\left(\dfrac{20000}{10000}\right)^{1/n} - 1 = 0.259, so 21/n=1.2592^{1/n} = 1.259.

Since 21/3≈1.2592^{1/3}\approx 1.259, we get n=3n = 3 years.

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