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 directors of E limited made the final call of Rs. 50 per share on 1st August 2012 indicating the last date of payment of call money to be 31st August. Mr. White holding 5000 shares paid the call money on October 15th 2012. If the company adopts table 'F', the amount of interest on calls-in-arrears to be paid by Mr. White would be _________.

  1. Rs. 1562.5

  2. Rs. 3125

  3. Rs. 1875

  4. Rs. 1500
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Table F interest on calls-in-arrears is 10% per annum. Amount = 5000 * 50 = 250,000. Delay = 1.5 months (Sept 1 to Oct 15). Interest = 250,000 * 0.10 * (1.5 / 12) = 3125.

Multiple choice

A sum of Rs. 725 is borrowed at the beginning of a year at some interest. After 8 months, a sum of Rs. 362.50 more is borrowed at a rate of interest double the earlier one. At the end of the year, the sum of interests on both loans is Rs. 43.50. What was the initial rate of interest per annum?

  1. 3.5%

  2. 4.5%

  3. 5%

  4. 5.5%

  5. 6%
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Let rate be R. Interest 1 = (725 * R * 1) / 100. Interest 2 = (362.5 * 2R * 4/12) / 100 = (362.5 * 2R * 1/3) / 100. Total interest = 43.50. (725R + 241.66R) / 100 = 43.50. 966.66R = 4350. R = 4.5%.

Multiple choice

Bank of USA lent $2000 for a year to Joe. The interest on the loan was 7% of the amount lent to be received back together with the loan at the end of the year. What was the total amount Joe needed to pay off the loan?
  1. $2100.40
  2. $2104.00
  3. $2140.00
  4. $2410.00
  5. $2540.00
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

The interest is 7% of \$2000, which is 0.07 * 2000 = \$140. The total amount to be paid back is the principal plus the interest, which is $2000 + $140 = $2140.

Multiple choice

A father left a will in which he distributed his property worth Rs. 35 lakh between his two daughters aged 8.5 and 16 such that they might get equal amounts when each of them reaches the age of 21 years. The original amount of Rs. 35 lakh was instructed to be invested at 10% p.a. simple interest. How much money did the elder daughter get at the time of the will?

  1. Rs. 17.5 lakh

  2. Rs. 21 lakh

  3. Rs. 15 lakh

  4. Rs. 20 lakh

  5. Rs. 25 lakh
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Let x be the amount for the elder daughter (age 16) and (35-x) for the younger (age 8.5). They reach 21 in 5 and 12.5 years respectively. Amount = P(1 + rt/100). x(1 + 0.1*5) = (35-x)(1 + 0.1*12.5) => 1.5x = (35-x)(2.25) => 1.5x = 78.75 - 2.25x => 3.75x = 78.75 => x = 21.

Multiple choice

Sudhir deposited Rs. 500 in a bank and got Rs. 583.20 in 2 years compounded annually. How much would he get after a year, if the rate of interest is increased by 2%?

  1. Rs. 540

  2. Rs. 550

  3. Rs. 545

  4. Rs. 510

  5. Rs. 530
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

First, find the original interest rate using the compound interest formula: 583.20 = 500 * (1 + R/100)^2, which gives R = 8%. Increasing this rate by 2% results in a new rate of 10%. The amount Sudhir would get after 1 year at 10% simple or compound interest is 500 * 1.10 = Rs. 550.