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- Most Important Multiple Choice Questions
- Online Exercise on Interest with Correct Answer Key and Solutions
- Useful for all Competitive Exams

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- Question 1 of 18
##### 1. Question

Mahesh invests an amount of Rs 8,[email protected] 4% p.a. for 2 years. What approximate amount of compound interest will he obtain at the end of 2 years?

##### Hint

Compound Interest

= 8560 × 0.0816 = Rs 698.496 ≈ Rs 698

- Question 2 of 18
##### 2. Question

What would be the compound interest obtained on an amount of Rs 3,000 at the rate of 8% p.a. after 2 years?

##### Hint

Required Compound Interest

=

= 3000

= 3000

= 3000

=

= Rs 499.20

- Question 3 of 18
##### 3. Question

Pamela invested an amount of Rs 35,000 for two year at the rate of 5% p.a. What amount of compound interest would she receive at the end of two year?

##### Hint

Compound interest

=– 35000

= 38587.50 – 35000 = Rs 3587.50

- Question 4 of 18
##### 4. Question

Shyam invests an amount of Rs 5,690 at the rate of 5 per cent per annum for 3 years. What approximate amount of compound interest will he obtain at the end of 3 years?

##### Hint

Amount = Principal

= 5690

= 5690 ×

= Rs 6586.90

∴ Compound interest = Rs(6586.9 – 5690)

= Rs 896.9 ≈ 897

- Question 5 of 18
##### 5. Question

What amount of compound interest can be obtained on an amount of Rs 4,500 at the rate of 4% p.a at the end of 2 years?

##### Hint

Compound Interest

= Principal

= 4500 × = Rs 367.20

- Question 6 of 18
##### 6. Question

What would be the compound interest accrued on an amount of Rs 8,400 @ 12.5% p.a. at the end of 3 years? (rounded off to two digits after decimal)

##### Hint

Compound interest

= 11960.1562 – 8400

= Rs 3560.1562

- Question 7 of 18
##### 7. Question

What would be the compound interest accrued on an amount of Rs 8000 at the rate of 15% p.a. in three year?

##### Hint

Compound interest

= 8000(1 + ¹⁵⁄₁₀₀)³ – 8000

=

= 12167 – 8000 = Rs 4167

- Question 8 of 18
##### 8. Question

What will be the compound interest on an amount of Rs 5,000 for a period of 2 year at 8% p.a?

##### Hint

∴ CI = Rs (5832 – 5000) = Rs 832

- Question 9 of 18
##### 9. Question

What will Rs 1000 be worth after three years if it earns interest at the rate of 5% compounded annually?

##### Hint

;

Required amount

=

= Rs 1000 × 1.157

= Rs 1157

- Question 10 of 18
##### 10. Question

Zovo got a loan of Rs 8,000 against his fixed deposits to purchase a scooter. If the rate of interest is 10% p.a. compounded half yearly, find the amount that he pays after one and half year.

##### Hint

Here, n = 2 for interest is reckoned half-yearly.

- Question 11 of 18
##### 11. Question

A sum of money doubles itself in 6 years at a certain rate of compound interest. In how many years will be 16 times at the same rate of interest?

##### Hint

P becomes 2P in 6 years at r% p.a.

∴ P becomes 16 P in 24 years

- Question 12 of 18
##### 12. Question

A sum of money doubles itself at compound interest in 15 years In how many years will it become eight times?

##### Hint

… (i)

Let

[using (i)]

Thus, the required time = 45 years

- Question 13 of 18
##### 13. Question

If a sum of money at compound interest amounts to thrice itself in 3 years, then in how many years will it be 9 times itself?

##### Hint

Let sum be Rs P

… (i)

Now, let

[By (i)]

⇒ n = 6

- Question 14 of 18
##### 14. Question

A sum of money is borrowed and paid back in two annual installments of Rs 882 each allowing 5% compound interest. The sum borrowed was:

##### Hint

Principal = (Present worth of Rs 882 due 1 year hence) + (Present worth of Rs 882 due to 2 years hence)

- Question 15 of 18
##### 15. Question

Jack set up a factory by investing Rs 40,000. During the first three successive years, his profits were 5%, 10% and 15 % respectively. If each year the profit was on previous years’s capital, find his total profit.

##### Hint

Since, each year the profit is on the previous year’s capital,

∴ it is similar to Compound profit.

∴ compound profit

= 40,000 [1.328 –1]= Rs 13, 130

- Question 16 of 18
##### 16. Question

The least number of complete years in which a sum of money put out at 20% compound interest will be more than doubled is:

##### Hint

Now,

So, n = 4 years

- Question 17 of 18
##### 17. Question

What annual payment will discharge a debt of Rs 1025 due in 2 years at the rate of 5% compound interest?

##### Hint

Let each installment be Rs x. Then,

(Present worth of Rs x due 1 year hence) + (Present worth of Rs x due 2 years hence) = Rs 1025

So, value of each installment = Rs 551.25.

- Question 18 of 18
##### 18. Question

The simple interest on a sum of money for 3 years is Rs 240 and the compound interest on the sum at same rate for 2 years in Rs 170. The rate % p.a. is

##### Hint

S. I. for I year

C. I. for 2 years = Rs 170 = C. I. for 1st year + C. I. for 2nd year

Now, C. I. for 2nd year = 170 – 80 = Rs 90

∴ Interest on Rs 80 for 1 year = 90 – 80 = Rs 10

∴ Rate of interest

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