Quantitative Aptitude

Simple and Compound Interest

3,394 Questions
All Simple interest and its inverse forms 768 Compound interest with annual compounding 742 Simple-interest growth and split sums 626 Difference between compound and simple interest 479 Half-yearly and quarterly compounding 252 Changing rates and fractional years 201 Installments (CI based) 190 Ratio of principal to interest 118 Population growth and depreciation 16

Simple and Compound Interest Questions

Multiple choice

A man invests Rs. 1,200 for two years at compound interest. After one year his money amoiunts to Rs. 1,275. Find the interest for the second year correct to the nearest rupee.

  1. Rs. 60

  2. Rs. 80

  3. Rs. 100

  4. Rs. 120
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Principal = 1200. Amount after 1 year = 1275. Interest for 1st year = 75. Rate = (75 / 1200) * 100 = 6.25%. For compound interest, the interest for the 2nd year is 6.25% of the amount after 1 year: 1275 * 0.0625 = 79.6875. Rounded to the nearest rupee, this is 80.

Multiple choice

The simple interest on a certain sum compoudes to Rs. $256$ in $2$ years, whereas the compund interest on the same sum at the same rate and for the same time computes to Rs. $276.48$. Find the rate per cent and the sum.
  1. $18\%, Rs. 800$
  2. $16\%, Rs. 800$
  3. $14\%, Rs. 800$
  4. $12\%, Rs. 800$
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

For 2 years, the difference between compound and simple interest is P(r/100)^2. Using 276.48 - 256 = 20.48 and simple interest 2Pr/100 = 256 gives r = 16% and P = Rs 800.

Multiple choice

Natesh borrowed some money at rate $6\%$ p.a. for the first $3$ years, $9\%$ p.a. for the next five years and $13$ p.a. beyond $8$ years. The above are all simple interest rates. If Natesh pays a total of Rs. $8160$ as an interest after $11$ years , how much money did he borrow?
  1. Rs. $8000$
  2. Rs. $10000$
  3. Rs. $12000$
  4. Rs. $14000$
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

The total simple-interest rate over 11 years is 3 × 6% + 5 × 9% + 3 × 13% = 102%. Therefore, 1.02P = 8160, giving P = Rs. 8000.

Multiple choice

A sum of money is invested at C.I. payable annually. The amounts of interest in two successive years are Rs. 2,700 and Rs. 2,880. Find the rate of interest.
  1. $2\frac{1}{3}\%$
  2. $6\frac{2}{3}\%$
  3. $7\frac{5}{3}\%$
  4. $11\frac{7}{3}\%$
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

The difference in interest between two years is the interest on the previous year's interest. 2880 - 2700 = 180. Rate = (180 / 2700) * 100 = 18/270 * 100 = 2/30 * 100 = 20/3 = 6 2/3%.

Multiple choice

The simple interest on a sum of money will be Rs. $500$ after $10$ years. If principal is double after $5$ years., the total interest at the end of the $10$ th year will be
  1. Rs. $350$
  2. Rs. $650$
  3. Rs. $500$
  4. Rs. $750$
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

The original principal earns Rs. 500 in 10 years, so it earns Rs. 250 in the first 5 years. After the principal doubles, the interest rate per year also doubles, giving Rs. 500 in the next 5 years. The total interest is Rs. 250 + Rs. 500 = Rs. 750.