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 sum of Rs. 10,000 was invested under two schemes. In the first scheme, the rate of interest was 10% p.a. and in the second scheme, the rate of interest was 8% p.a. The ratio of interest for the first scheme to that for the second scheme is 15 : 8. Calculate the amount invested in the first scheme.

  1. Rs. 10,000

  2. Rs. 6,000

  3. Rs. 4,000

  4. Rs. 8,000

  5. Rs. 2,000
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Let x be the amount in the first scheme and 10000-x in the second. Interest 1 = 0.10x, Interest 2 = 0.08(10000-x). Ratio (0.10x) / (0.08(10000-x)) = 15/8. Solving for x: 0.10x / (800 - 0.08x) = 1.875. 0.10x = 1500 - 0.15x. 0.25x = 1500, x = 6000.

Multiple choice

The simple interest on a sum of money for 2 years at 5% per annum is Rs. 480. What is the compound interest on that sum of money for one year payable half-yearly at the same rate?

  1. Rs. 280

  2. Rs. 213

  3. Rs. 243

  4. Rs. 253
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Simple interest for 2 years at 5% is 10% of principal = 480, so principal = 4800. Compound interest for 1 year at 5% compounded half-yearly (2.5% per half-year) = 4800 * (1.025^2 - 1) = 4800 * 0.050625 = 243.

Multiple choice

Rahul deposited Rs. 7,500 at 4% p.a. for 2 years compounded annually in a bank. Jasmine deposited Rs. 7,500 for simple interest at the rate of 5% p.a. for 2 years. What is the difference between the amount of money they earned at the end of two years?

  1. Rs. 8,250

  2. Rs. 8,112

  3. Rs. 138

  4. Rs. 190

  5. Rs. 128
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Rahul's amount = 7500 * (1.04)^2 = 7500 * 1.0816 = 8112. Jasmine's amount = 7500 + (7500 * 0.05 * 2) = 7500 + 750 = 8250. Difference = 8250 - 8112 = 138.

Multiple choice

Mr. Magnet got a loan of Rs. 21,000 at 10% simple interest. He repaid that loan in 24 equal monthly installments, each being paid at the end of every month starting from the next year; that means for the first year, he did not pay anything and for the next 2 years he paid the installments and cleared the loan exactly by the end of the third year. What was approximate each installment he paid?

  1. Rs. 800

  2. Rs. 1,038

  3. Rs. 1,240

  4. RS. 1,128

  5. Rs. 1,057
Reveal answer Fill a bubble to check yourself
B Correct answer
Multiple choice

Ram is a partner in a firm. He made the following drawings: | 1st July | Rs. 200 | | --- | --- | | 1st August | Rs. 200 | | 1st September | Rs. 300 | | 1st November | Rs. 50 | | 1st February | Rs. 100 | If the rate of interest on drawings is 6% and accounts are closed on 31st March, then what is the interest on drawings?

  1. Rs. 29.75

  2. Rs. 35

  3. Rs. 30

  4. Rs. 40
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Calculate product of amount and months remaining until March 31: July (9 months), Aug (8), Sept (7), Nov (5), Feb (2). Product = (200*9) + (200*8) + (300*7) + (50*5) + (100*2) = 1800 + 1600 + 2100 + 250 + 200 = 5950. Interest = (5950 * 6 * 1) / (100 * 12) = 29.75.