Simple and Compound Interest Questions and Answers
September 15, 2023
Simple Interest and Compound Interest Questions
Simple and Compound Interest Questions and Answers are provided on this page for students to practice and get an idea how this topic is asked in the exam.
Simple InterestWhen 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”.
Compound InterestSometimes 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.
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}
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