Quantitative Aptitude · Commerce Accountancy

Interest and Annuities

621 Questions

Interest and annuities represent a critical quantitative aptitude section focusing on the mathematical calculation of simple interest, compound interest, and future values of investments. Questions challenge candidates to determine maturity values, compute recurring deposit returns, and calculate prevailing interest rates. Mastery of this topic is essential for scoring high in banking and SSC examinations.

Simple and compound interestFuture value of annuitiesRecurring deposit calculationsInterest rate determinationPresent value formulas

Interest and Annuities Questions

Multiple choice commerce securities exchange board of india (sebi) objectives of sebi significance, functions of stock exchange, bse & nse stock exchanges functions of sebi sebi securities and exchange board of india (sebi)

The settlement cycle in NSE is?

  1. $T+5$
  2. $T+3$
  3. $T+2$
  4. $T+1$
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

In a rolling settlement , each trading day is considered as a trading period and trades executed during the day are settled based on net obligations for the day. In India, trades in rolling settlement are settled on a T+2 basis i.e. on the 2nd working day after a trade.

Multiple choice mathematics and statistics compound interest [using formula] compounding interest annually compouding interest compounding interest non-annually

Find the amount of Rs 12000 after 2 years compounded annually the rate of interest being 5 % pa during the first year and 6% pa during the second year also find the compound interest?

  1. Rs 1356

  2. Rs 1200

  3. Rs 1256

  4. Rs None of these
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

P=Rs.12000,Time=2 Years,Rate=5% and 6%
$A=P\left(1+\frac{R}{100}\right)^T$
$\Rightarrow 12000\left(1+\frac{5}{100}\right)\left(1+\frac{6}{100}\right)$
$\Rightarrow 12000\times \frac{105}{100}\times \frac{106}{100}$
$\Rightarrow 13356  Rs$
$C.I=A-P$
$\Rightarrow 13356-12000=1356  Rs.$

Multiple choice mathematics and statistics compound interest [using formula] compounding interest annually compouding interest compounding interest non-annually

A sum of money at CI amounts to thrice itself in $3$ years. In how many years will it be $9$ times itself?

  1. $18$
  2. $12$
  3. $6$
  4. $3$
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

$\Rightarrow$ Let the sum = $Rs.x$.

$\Rightarrow$  Then we have $3x=x(1+\dfrac{r}{100})^3$
$\Rightarrow$  By squaring both the sides,
$\Rightarrow$  $9x^2=x^2(1+\dfrac{r}{100})^6$
$\therefore$   The sum x will be 9 times in $6\, years.$

Multiple choice mathematics and statistics compound interest [using formula] compounding interest annually compouding interest compounding interest non-annually

A man borrowed Rs.$60,000$ for $2$ years at $8$ % per year compound interest. 

Calculate the final amount at the end of the second year.

  1. Rs. $68,984$
  2. Rs. $69,744$
  3. Rs. $69,910$
  4. Rs. $69,984$
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

$\Rightarrow$  $P=$Rs.$60000,\,T=2\,$years and $R=8\%$


$\Rightarrow$  $A=P(1+\dfrac{R}{100})^T$

$\Rightarrow$  $A=60000\times (1+\dfrac{8}{100})^2$

$\Rightarrow$  $A=60000\times (\dfrac{27}{25})^2$

$\Rightarrow$  $A=60000\times \dfrac{729}{625}$

$\therefore$     $A=$Rs. $69,984.$

Multiple choice mathematics and statistics compound interest [using formula] compounding interest annually compouding interest compounding interest non-annually

What amount will sum up to Rs. $6,6550$ at $10$% p.a. in C.I. in $3$ years?

  1. $40000$
  2. $50000$
  3. $60000$
  4. $70000$
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation
$\Rightarrow$  Here, $A=Rs.66550\,R=10\%$ and $T=3\,years$
$\Rightarrow$  $A=P(1+\dfrac{R}{100})^T$

$\Rightarrow$  $66550=P\times (1+\dfrac{10}{100})^3$

$\Rightarrow$  $66550=P\times (\dfrac{11}{10})^3$

$\therefore$   $P=\dfrac{66550\times 1000}{1331}=Rs.50000$
Multiple choice mathematics and statistics compound interest [using formula] compounding interest annually compouding interest compounding interest non-annually

A sum of Rs. $8,000$ is invested for $3$ years at $10 \%$ per annum compound interest. Calculate the interest for the second year.

  1. $440$
  2. $880$
  3. $330$
  4. $800$
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Given, $P=$ Rs. $8,000,\,R=10\%$.

Interest for second year $=$ $P\times \dfrac{R}{100}\times \left (1+\dfrac{R}{100}\right)$
$=$ $8000\times \dfrac{10}{100}\times \left (1+\dfrac{10}{100}\right)$
$=$ $800\times \dfrac {11}{10}$
Therefore, interest for second year $=$ Rs. $880.$

Multiple choice mathematics and statistics compound interest [using formula] compounding interest annually compouding interest compounding interest non-annually

In what time will Rs, $15,000$ yield Rs. $4965$ as compound interest at $10$% per year compounded annually?

  1. $3$ years
  2. $2$ years
  3. $1$ years
  4. $4$ years
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Interest for the first year 

$=\cfrac{1500\times 10\times 1}{100}$
$=$ Rs $1500$
Amount after the first year $=$ Rs $15000+1500$
$=$ Rs $ 16500$ 
Interest for the second year
$=$ $\cfrac{16500\times 10\times 1}{100}$
$=$ Rs $1650$
Amount after the third year 
$=$ $\cfrac{18150\times 10\times 1}{100}$
$=$ Rs $1815$
Final amount $= $ Rs $18150+1815$
$=$ Rs $19965$
Compound interest $=$ Rs $19965-15000$
 $=$ Rs $4965$
Required time $= 3$ years

Multiple choice mathematics and statistics compound interest [using formula] compounding interest annually compouding interest compounding interest non-annually

Find the compound interest on Rs. $70,000$ for $2$ years, compounded annually at $10\%$ per annum.

  1. $14,400$
  2. $14,700$
  3. $14,300$
  4. $14,100$
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Here,$P=$ Rs $7000$ , $R=10\%p.a$

interest for the first year $=\cfrac{P\times R\times T}{100}$
$=\cfrac{7000\times 10\times 1}{100}$
$=$ Rs $7000$
The amount after the first year $=$ Rs $77000$
Principal for the second year $=$ Rs $77000$
Interest for the second year $=$ Rs $\cfrac{77000\times 10\times 1}{100}$
$=$ Rs $7700$
The final amount $=$ Rs $77000$ + Rs $7700$
$=$ Rs $84700$
Compound interest $= $ Rs $84700 -70000$
$=$ Rs $14700$
                                                 


Multiple choice mathematics and statistics compound interest [using formula] compounding interest annually compouding interest compounding interest non-annually

A finance company declares that, with compound interest rate, a sum of money deposited by anyone will become $8$ times in three years. if the same amount is deposited at the same compound-rate of interest, then in how many years it will become $128$ times?

  1. $4$
  2. $5$
  3. $6$
  4. $7$
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

In three years.a sum of money deposited by anyone will become $=2^3=8$times

Therefore , to make sum of money $128$ times , then $2^7=128$, it will occcur in $7$ years.

Multiple choice mathematics and statistics compound interest [using formula] compounding interest annually compouding interest compounding interest non-annually

A sum of Rs.$12,000$ is invested for $3$ years at $18$ % per annum compound interest. Calculate the interest for the second year.

  1. $2500$
  2. $2525$
  3. $2550$
  4. $2575$
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Interest for first year  = $ \cfrac{12000 \times 1 \times 18}{100} = 2160$

Amount after first year = $ 12000+2160=14160$
Interest for second year =$ \cfrac{14160 \times 1 \times 18}{100} = 2550(approx)$ 

Multiple choice mathematics and statistics compound interest [using formula] compounding interest annually compouding interest compounding interest non-annually

A sum of Rs.$12,000$ is invested for $3$ years at $18$ % per annum compound interest. Calculate the interest for the third year.

  1. $2700$
  2. $2800$
  3. $2900$
  4. $3000$
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Interest for the first year =$ \cfrac{12000 \times 1 \times 18}{100} = 2160$

Amount after first year = $12000+2160 =14160$
Interest for second year =$ \cfrac{14160 \times 1 \times 18}{100} = 2550$
Amount after second year = $14160+2550 =16708.8$

Interest for third year =$ \cfrac{16708.8 \times 1 \times 18}{100} = 3000(approx)$

Multiple choice mathematics and statistics compound interest [using formula] compounding interest annually compouding interest compounding interest non-annually

A sum of Rs.$25,000$ is invested for $3$ years at $20$ % per annum compound interest. Calculate the interest for the third year.

  1. $6000$
  2. $7200$
  3. $8400$
  4. $5000$
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Interest for the first year =$ \cfrac{25000 \times 1 \times 20}{100} = 5000$

Amount after first year = $25000+5000 =30000$
Interest for second year =$ \cfrac{30000 \times 1 \times 20}{100} = 6000$
Amount after second year = $30000+6000 =36000$

Interest for third year =$ \cfrac{36000 \times 1 \times 20}{100} = 7200(approx)$

Multiple choice mathematics and statistics compound interest [using formula] compounding interest annually compouding interest compounding interest non-annually

The compound interest on $Rs. 64,000$ for $3$ years, compounded annually at $7.5$% per annum is

  1. $Rs. 14,400$
  2. $Rs. 15,705$
  3. $Rs. 15,507$
  4. $Rs. 15,075$
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

$Principal = 64000$
$Rate = 7.5\% \,p.a$
$Time = 3 years$ 
$\text{Where r is the rate and t is the time.}$
$CI = 64000 (1 + 7.5/100)^3 - 64000$
$= 64000 (1 + 75/1000)^3 - 64000$
$= 64000 (1 + 3/40)^3 - 64000$
$= 64000 (43/40)^3 - 64000$
$= 64000 * 43/40 * 43/40 * 43/40 - 64000$
$= 43 * 43 * 43 - 64000$
$= 79507 - 64000$
$= 15507$
$\text{Hence CI will be 15507 rupees}$