Questions and Answers on Simple and Compound Interest

Simple Interest and Compound Interest Questions

Simple Interest
When a person borrows money from someone for a specific period, then the borrower has to pay some extra money called Interest on the money borrowed for that period”.
The money borrowed is called “Principal” .

The total sum of money including the principal is known as the “Amount.”
If the interest on the specific sum borrowed for a certain period is calculated uniformly, then it is called “Simple Interest.”

Compound Interest
Sometimes it also happens that the borrower and the money lender agree to fix up a certain period, say quarterly or half- yearly or yearly, to resolve the former account.

In such cases, the sum after the initial part of the time becomes the principal for the second unit, the amount after the second unit becomes the principal for the third unit and so on.
After a certain period, the difference between the amount and the money borrowed is called the Compound Interest for that period of time.

Simple Interest Questions and Answers

The formula of Simple Interest:

  • SI on Principal P at R% per annum for T years is denoted as:
    Simple Interest = (P*R*T)/100

Where, P=Principle, R=Rate(per annum), T=Total time

The formula for Compound Interest:

  • If Principal= Rs P, Time= t years and Rate= r% p.a., n=number of times the interest got compounded annualy. So the compound interest calculated annually will be:
    Amount after t years= P \left ( 1+\frac{r}{100n} \right )^{nt}
  • CI calculated half yearly:   Rate= r% per half year and n= 2.
    Amount after t years= P \left ( 1+\frac{r}{100\times 2} \right )^{2t}
  • CI calculated Quarterly:   Rate= r% per quarter; n= 4.
    Amount after t years= P \left ( 1+\frac{r}{100\times 4} \right )^{4t}
Questions on Simple and Compound Interest

Question 1

Time: 00:00:00
Find the number of years the amount of Rs. 1500 will take to grow into Rs. 15000, if the rate of investment is 15% simple interest?

80

80

60

60

72

72

56

56

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Question 2

Time: 00:00:00
Ashish lends Rs. 20000 in four different parts. If he gets 8% on Rs. 4000, 7.5% on Rs. 8000, and 8.5% on Rs. 2800. Find the percentage he will receive on the remaining amount if the annual average interest he gets is 8.13%?

10.5%

10.5%

7%

7%

9.6%

9.6%

9%

9%

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Question 3

Time: 00:00:00
Anil gave Rs. 7000 to Bhawani for 2 years. He also gave rs. 5000 to Chirag for 4 years. The money he gave was on simple interest and at a similar interest rate. The interest rate he received from both of them was rs. 3060. Find the interest rate per annum.

10%

10%

7.5%

7.5%

9%

9%

11%

11%

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Question 4

Time: 00:00:00
Rs. 1725 is given by Prabha on loan at the starting of a year at a certain interest rate. She also gave rs. 1362.50 to her friend after 4 months, but this time the rate was two times the earlier ones. The total interest she earned from both the loans was rs. 133.50. Find out the original interest rate.

7.5%

7.5%

9.7%

9.7%

5.06%

5.06%

4.89%

4.89%

7.75%

7.75%

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Question 5

Time: 00:00:00
Akash took loan @ 15% p.a. If after 5 years he is intended to pay Rs. 5400 simple interest, then find the principal amount he borrowed?

8000

8000

7200

7200

12000

12000

9000

9000

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Question 6

Time: 00:00:00
Find the number of years the amount of Rs. 1375 will take to grow into Rs. 20000, if the rate of investment is 15% simple interest?

115

115

52

52

77

77

90.3

90.3

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Question 7

Time: 00:00:00
A person invests his savings half amount in a Fixed Deposits on which he received Rs. 550 as simple a simple interest amount for 2 years. He also financed the leftover in an F.D. for 2 years which gives compound interest, and the interest is being given annually, at a similar interest rate. The interest amount on this he got as Rs.605. Now before investment into the Fixed Deposit find out the price of his total savings?

5000

5000

2200

2200

1100

1100

2750

2750

None of the above

None of the above

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Question 8

Time: 00:00:00
An amount is changed to Rs. 1800 in 5 years and to Rs. 1954 in 6 years. If the interest is calculated as a simple interest, then calculate the amount.

1350

1350

1690

1690

1030

1030

1700

1700

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Question 9

Time: 00:00:00
An amount generated a simple interest of Rs. 5016.25 at the rate of 5 percent per annum rate in 4 years. Calculate the amount?

Rs. 32,097.5

Rs. 32,097.5

Rs. 30,097.5

Rs. 30,097.5

Rs. 33,097.5

Rs. 33,097.5

Rs. 31,097.5

Rs. 31,097.5

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Question 10

Time: 00:00:00
A person invested Rs.3500 on an interest rate of 6% per annum, Rs.1050 is obtained as interest in certain years. In order to earn Rs.1800 as interest on Rs.4500 in the same years what should be a rate of simple interest.

4.5%

4.5%

8%

8%

9.3%

9.3%

5%

5%

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Question 11

Time: 00:00:00
On a principal amount, the simple interest for 2 years at 8% per year is 30 less in comparison to the simple interest on the same amount for 3 years at 6% per year. Calculate the total amount in INR.

1750

1750

1600

1600

1200

1200

1500

1500

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Question 12

Time: 00:00:00
Manjari borrowed the amount of Rs. 12000 with simple interest. When she borrowed the amount, the number of years and the interest rate was the same. If she returned Rs. 4320 as simple interest, then find the interest rate.

36

36

18

18

6

6

21

21

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Question 13

Time: 00:00:00
Find the rate of simple interest if an amount of Rs. 18,900 is grown to Rs. 21,900 in 4 years.