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

The simple interest on a sum of money is $\dfrac49$of the principal and the number of years is equal to the rate of interest. The rate percent is-
  1. $3 \dfrac{1}{4}$
  2. $6 \dfrac{2}{3}$
  3. $6$
  4. $5$
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Simple interest is given by (P * R * T) / 100. We are told SI = (4/9)P and R = T. Substituting these gives (4/9)P = (P * R * R) / 100, which simplifies to R^2 = 400/9. Taking the square root, R = 20/3, which is 6 2/3 percent.

Multiple choice

Vineet deposited Rs. 15,600 in a fixed deposit at simple interest at the rate of 10%. After every second year he converts his interest earnings into deposits. His interest in the fourth year is-

  1. Rs. 1,716

  2. Rs. 1,560

  3. Rs. 3,432

  4. Rs. 1,872
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Principal = 15600, Rate = 10%. Interest for first 2 years = (15600 * 10 * 2) / 100 = 3120. New principal = 15600 + 3120 = 18720. Interest for the 3rd and 4th year = (18720 * 10 * 2) / 100 = 3744. Interest for the 4th year specifically is half of that, which is 1872.

Multiple choice

On what date will Rs.1,950 lent on $5^{th}$ January, 1991 amount to Rs.2,125.50 at 5 per cent per annum simple interest ?
  1. $23^{rd}$ Oct. 1992
  2. $20^{th}$ Oct. 1992
  3. $27^{th}$ Oct. 1992
  4. $26^{th}$ Oct. 1992
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Simple interest = 2125.50 - 1950 = 175.50. Using SI = (P*R*T)/100, 175.50 = (1950 * 5 * T) / 100, so T = 175.50 / 97.5 = 1.8 years. 1.8 years is 1 year and 0.8 * 365 days = 1 year and 292 days. From Jan 5, 1991, adding 1 year is Jan 5, 1992. Adding 292 days leads to October 23, 1992.

Multiple choice

A person deposited a sum of Rs. 6000 in a bank at 5% per annum simple interest. Another person deposited Rs. 5000 at 8% per annum compound interest. After two years the difference of their interest will be -

  1. Rs .230

  2. Rs .232

  3. Rs .832

  4. Rs .600
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Simple interest on 6000 at 5% for 2 years is 6000 * 0.05 * 2 = 600. Compound interest on 5000 at 8% for 2 years is 5000 * (1.08^2 - 1) = 5000 * 0.1664 = 832. The difference is 832 - 600 = 232.