Compound interest questions Practice Question and Answer

Q: Mr Amin borrowed a certain sum from Mr Visvas. He borrowed for first 2 year at 8% per annum, for next 3 years at 11% per annum and beyond that at 14% per annum. Mr Amin paid Rs 10,920 as Simple interest in 8 years. Find how much he had borrowed? 1964 0

  • 1
    Rs 12000
    Correct
    Wrong
  • 2
    Rs 15000
    Correct
    Wrong
  • 3
    Rs 14000
    Correct
    Wrong
  • 4
    Data insufficient
    Correct
    Wrong
  • 5
    None of these
    Correct
    Wrong
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Answer : 1. "Rs 12000"
Explanation :

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Q: A certain sum amounts to Rs 1308 in 3 years, while it becomes Rs 1380 in 5 years. Find the principal. 1620 1

  • 1
    Rs 1100
    Correct
    Wrong
  • 2
    Rs 1200
    Correct
    Wrong
  • 3
    Rs 1300
    Correct
    Wrong
  • 4
    Rs 1400
    Correct
    Wrong
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Answer : 2. "Rs 1200"
Explanation :

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Q:

One certain Principal if the Simple interest for two years is Rs 2400 and Compound interest for the two years is Rs 2544, what is the rate of Interest? 

8632 0

  • 1
    12 %
    Correct
    Wrong
  • 2
    6 %
    Correct
    Wrong
  • 3
    24 %
    Correct
    Wrong
  • 4
    18 %
    Correct
    Wrong
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Answer : 1. "12 % "

Q: Compounding interest means interest accrues 1506 1

  • 1
    at variable rates throughout the term
    Correct
    Wrong
  • 2
    more quickly than simple interest
    Correct
    Wrong
  • 3
    more slowly than simple interest
    Correct
    Wrong
  • 4
    at the same rate as simple interest
    Correct
    Wrong
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Answer : 2. "more quickly than simple interest"
Explanation :

Answer: B) more quickly than simple interest Explanation: Compounding interest means interest accrues on the interest charged and the principal amount each period the interest is charged. Compound interest is calculated by multiplying the principal amount by one plus the annual interest rate raised to the number of compound periods minus one.The total initial amount of the loan is then subtracted from the resulting value. The formula for calculating compound interest is: [P (1 + i)n] – P = P [(1 + i)n – 1] (Where P = Principal, i = nominal annual interest rate in percentage terms, and n = number of compounding periods.) Take a three-year loan of Rs. 10,000 at an interest rate of 5% that compounds annually. What would be the amount of interest? In this case, it would be: Rs. 10,000 [(1 + 0.05)3] – 1 = 10,000 [1.157625 – 1] = Rs. 1,576.25.   How it grows ::

Q: What amount of compound interest can be obtained on the principal amount of Rs. 15800 at the rate of 6 percent per annum at the end of 2 years? 1970 0

  • 1
    Rs 1,896
    Correct
    Wrong
  • 2
    Rs.2012.48
    Correct
    Wrong
  • 3
    Rs. 1952.88
    Correct
    Wrong
  • 4
    Rs.1,956
    Correct
    Wrong
  • 5
    None of these
    Correct
    Wrong
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Answer : 3. "Rs. 1952.88"

Q: The simple interest accrued on an amount of Rs 15,000 at the end of three year is Rs 2,250. What would be the compound interest accrued on the same amount at the same rate in the same period? 1756 0

  • 1
    Rs 8934.6784
    Correct
    Wrong
  • 2
    Rs 8017.5744
    Correct
    Wrong
  • 3
    Rs 7861.8754
    Correct
    Wrong
  • 4
    Cannot be determined
    Correct
    Wrong
  • 5
    None of these
    Correct
    Wrong
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Answer : 5. "None of these"

Q: If rate of interest is 2% more, the amount will exceed Rs. 60 for one year, find the principal? 1099 0

  • 1
    300
    Correct
    Wrong
  • 2
    3,000
    Correct
    Wrong
  • 3
    6,000
    Correct
    Wrong
  • 4
    4,000
    Correct
    Wrong
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Answer : 2. "3,000"

Q:

A bank offers 15 % compound interest per half-year. A customer deposits Rs 2400 each on 1 January and 1st July of a year. At the end of the year, the amount he would have gained by way of interest is –

3391 0

  • 1
    Rs. 2268
    Correct
    Wrong
  • 2
    Rs. 1134
    Correct
    Wrong
  • 3
    Rs. 567
    Correct
    Wrong
  • 4
    Rs. 283
    Correct
    Wrong
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Answer : 2. "Rs. 1134 "

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