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Quiz: Compound Interest

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Number of Questions: 30

Question: 6 -

Calculate the compound interest on Rs. 4000 for 2 years at 20% per annum when compounded annually.

Options:

  1. 1746.4

  2. 1846.4

  3. 1856.4

  4. 1756.4

    5. Answer:

    1856.4
    Solution:

    A = P (1 + R/200)2n = 4000(11/10)4 = Rs. 5856.4
    C.I. = 5856.4 – 4000 = Rs. 1856.4.

Question: 7 -

What will be the amount to be paid at the end of 7 years on Rs. 3500 at 2% per annum compounded annually?

Options:

  1. 4428.5

  2. 3456.89

  3. 4020.39

  4. 4229.56

    5. Answer:

    4020.39
    Solution:

    Principal = Rs. 3500
    Rate = 2%
    Time = 7 years
    Amount = P (1 + R/100)t = 3500 (1 + 2/100)7 = 3500 (102/100)7 = 3500 × 1.148 = 4020.39

Question: 8 -

If the amount is Rs. 400 and Principal is Rs. 100 which is compounded half yearly for 1 year, calculate the rate of interest.

Options:

  1. 20

  2. 10

  3. 2

  4. 200

    5. Answer:

    200
    Solution:

    A = P (1 + R/200)2n
    ⇒ 400 = 100 (1 + R/200)2
    ⇒ 2 = 1 + R/200
    R = 200.

Question: 9 -

Compute the compound interest on Rs. 16000 for 2 years 10% per annum when compounded half yearly.

Options:

  1. 18600

  2. 18640

  3. 17640

  4. 17600

    5. Answer:

    17640
    Solution:

    A = P (1 + R/200)2n
    ⇒ A = 16000 (1 + 10/200)2 = 16000 (21/20)2 = Rs. 17640.

Question: 10 -

Find the amount on Rs. 5000 at the rate of 20% per annum for 18 months when interest is compounded half yearly.

Options:

  1. 6666

  2. 6644

  3. 6000

  4. 6655

    5. Answer:

    6655
    Solution:

    n = 18/12 = 3/2
    A = P (1 + R/200)2n = 5000 (1 + 20/200)2n = Rs. 6655.