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Quiz: Compound Interest

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Number of Questions: 30

Question: 1 -

Find the Compound Interest on Rs. 1000 for two years at 2% per annum.

Options:

  1. 20.4

  2. 20.6

  3. 20.5

  4. 20

    5. Answer:

    20.4
    Solution:

    Principal for the first year = Rs. 1000
    Interest for the first year = 1000 × 2 × 1/100 = Rs. 20
    Amount at the end of one year = 1000 + 20 = Rs. 1020
    Interest for second year = 1020 × 2 × 1/100 = Rs. 20.4
    Principal for the second year = Rs. 1020
    Amount at the end of one year = 1000 + 20. 4 = Rs. 1040.4
    C.I. = Amount – Principal = 1040.4 – 1020 = Rs. 20.4.

Question: 2 -

Evaluate the compound interest on Rs. 10101 for 3 years at the rate of 9% per annum compounded annually.

Options:

  1. 30000

  2. 2980

  3. 33333

  4. 10101

    5. Answer:

    2980
    Solution:

    A = P (1 + R/100)n
    ⇒ A = 10101 (1 + 9/100)3 = 10101 (109/100)3 = Rs. 13081.08
    C.I. = A – P = 13081.08 – 10101 = Rs. 2980.08.

Question: 3 -

A farmer gets a loan of Rs. 100000 against his fixed deposits. If the rate of interest is 1.5 paise per rupee per annum, calculate the compound interest payable after 2 years.

Options:

  1. 52250

  2. 32250

  3. 22250

  4. 42250

    5. Answer:

    32250
    Solution:

    R = 1.5 paise per rupee per annum = 1.5 × 100 paise per hundred rupee per annum
    = 1.5 × 100/100 rupee per hundred rupee per annum = 1.5%

    Amount = 100000 (1 + 1.5/100)2 = 100000 (23/20)2 = 132250

    C.I. = 132250 – 100000 = Rs. 32250.

Question: 4 -

Vidhya lent Rs. 5000 to Kavya for 3 years at the rate of 5% per annum compound interest. Calculate the amount that Vidhya will get after 3 years.

Options:

  1. 5788.13

  2. 5789

  3. 5788.12

  4. 5788

    5. Answer:

    5788.13
    Solution:

    A = P (1 + R/100)n
    Amount for 3 years = 5000 (1 + 5/100)3 = 5000 (21/20)3 = 5788.13.

Question: 5 -

Calculate the compound interest at the rate of 6% per annum for 2 years on the principle which in 2 years at the rate of 2% per annum gives Rs. 8000 as simple interest.

Options:

  1. 59440

  2. 49000

  3. 49440

  4. 50000

    5. Answer:

    49440
    Solution:

    P = 8000 × 100/2 × 2 = 400000
    A = 400000(1 + 6/100)2 = 400000 (53/50)2 = Rs. 449440
    C.I. = 449440 – 400000 = Rs. 49440.