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

Arun invested a sum of money at a certain rate of simple interest, for a period of four years. If he had invested the same sum for a period of six years, the total interest earned by him would have been fifty percent more than the earlier interest amount. What was the rate of interest per annum?

  1. 4%

  2. 8%

  3. 5%

  4. Cannot be determined

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

Interest I = P*R*T/100. I1 = P*R*4/100. I2 = P*R*6/100. I2 = 1.5 * I1. 6PR/100 = 1.5 * 4PR/100. 6 = 6. This is an identity that holds for any R. Therefore, the rate cannot be determined.

Multiple choice

A sum of Rs. 15,000 is lent at 16% p.a. compound interest. What is the difference between the compound interest for the second year and the third year?

  1. Rs. 544

  2. Rs. 445.44

  3. Rs. 454.88

  4. Rs. 548

  5. Rs. 460
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

CI for 2nd year = 15000 * (1.16^2 - 1.16^1) = 15000 * (1.3456 - 1.16) = 15000 * 0.1856 = 2784. CI for 3rd year = 15000 * (1.16^3 - 1.16^2) = 15000 * (1.560896 - 1.3456) = 15000 * 0.215296 = 3229.44. Difference = 3229.44 - 2784 = 445.44.

Multiple choice

G invested Rs. 2400 in a bank paying 6% p.a. simple interest. At the end of a certain time, he withdrew the principal and interest, amounting to Rs. 3120. R invested 3/4 of G's principal in another bank which paid 8% simple interest p.a. for the same time. Find out how much interest R would receive from his bank.

  1. Rs. 720

  2. Rs. 1248

  3. Rs. 575

  4. Rs. 960

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

G's interest = 3120 - 2400 = 720. Time = 720 / (2400 * 0.06) = 5 years. R's principal = (3/4) * 2400 = 1800. R's interest = 1800 * 0.08 * 5 = 720.

Multiple choice

Vishwas borrowed a total amount of Rs. 30,000, part of it on simple interest rate of 12 percent per annum and remaining on simple interest rate of 10 percent per annum. If at the end of 2 years, he paid in all Rs. 36,480 to settle the loan amount, what was the amount borrowed at 12 percent per annum?

  1. Rs. 16,000

  2. Rs. 18,000

  3. Rs. 17,500

  4. Rs. 12,000

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

Let x be the amount at 12%. Interest = (x * 12 * 2)/100 + ((30000 - x) * 10 * 2)/100 = 6480. 0.24x + 6000 - 0.2x = 6480. 0.04x = 480. x = 12000.

Multiple choice

A bank pays simple interest at 4% per annum on first Rs. 5500 and an interest of 6% for amounts above that. Find the interest earned by Sameera if she deposits Rs. 13,250 with the bank for 2 years.

  1. Rs.1280

  2. Rs. 1370

  3. Rs. 840

  4. Rs. 1325

  5. Rs. 1425
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Interest on first 5500 at 4% for 2 years: (5500 * 4 * 2) / 100 = 440. Remaining amount is 13250 - 5500 = 7750. Interest on 7750 at 6% for 2 years: (7750 * 6 * 2) / 100 = 930. Total interest = 440 + 930 = 1370.