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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
