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

Direction : Study the following questions carefully and choose the right answer. Saahil invested one half of his savings in a Life Insurance Policy that paid simple interest for 2 years and received Rs. 550 as interest. He invested the remaining in another Life Insurance Policy that paid compound interest, interest being compounded annually, for 2 years at the same rate of interest and received Rs. 605 as interest. What was the value of his total savings before investing in these two policies?

  1. Rs. 3,050

  2. Rs. 3,250

  3. Rs. 2,680

  4. Rs. 2,750

  5. None of these
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Let S be the total savings. Half (S/2) earns simple interest: (S/2 * r * 2) / 100 = 550, so Sr = 55000. The other half earns compound interest: (S/2) * ((1 + r/100)^2 - 1) = 605. Substituting Sr = 55000, we solve for r and then S.

Multiple choice

What is the rate of interest per annum? I. The CI in 8 years is more than the amount. II. The difference between SI and CI in 2 years is Rs.450 III. An amount double itself at SI in 15 years

  1. Only I and II are sufficient

  2. Only III is sufficient

  3. Only II and III are sufficient

  4. All are not sufficient

  5. None
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Statement III says an amount doubles itself at SI in 15 years. Using SI = (P*R*T)/100, where SI = P and T = 15, we get P = (P*R*15)/100, which simplifies to R = 100/15 = 6.66%. Thus, statement III alone is sufficient to find the rate of interest.

Multiple choice

The simple interest on a certain sum for 4 yrs at a rate of 12.5% per annum is Rs 4000. What will be the compound interest on the same sum at a rate of 4% per annum after two years?

  1. Rs 762.8

  2. Rs 562.8

  3. Rs 652.8

  4. Rs 842.4
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Simple interest = P * R * T / 100. 4000 = P * 12.5 * 4 / 100 => 4000 = P * 0.5 => P = 8000. Compound interest for 2 years at 4% = 8000 * ((1 + 0.04)^2 - 1) = 8000 * (1.0816 - 1) = 8000 * 0.0816 = 652.8.