Compound Interest Problems Solutions

• 8. What will be the compound interest on Rs. 25000 after 3 years at the rate of 12 % per annum

  1. Rs 10123.20
  2. Rs 10123.30
  3. Rs 10123.40
  4. Rs 10123.50

  Answer :

  Option A

  Explanation:

  \begin{aligned}
  (25000 \times (1 + \frac{12}{100})^3) \\
  => 25000\times\frac{28}{25}\times\frac{28}{25}\times\frac{28}{25} \\
  => 35123.20 \\
  \end{aligned}
  
  So Compound interest will be 35123.20 - 25000
  = Rs 10123.20

• 9. Find compound interest on Rs. 7500 at 4% per annum for 2 years, compounded annually

  1. Rs 312
  2. Rs 412
  3. Rs 512
  4. Rs 612

  Answer :

  Option D

  Explanation:

  Please apply the formula
  
  \begin{aligned}
  Amount = P(1+\frac{R}{100})^n \\
  \text{C.I. = Amount - P}
  \end{aligned}

• 10. If the simple interest on a sum of money for 2 years at 5% per annum is Rs.50, what will be the compound interest on same values

  1. Rs.51.75
  2. Rs 51.50
  3. Rs 51.25
  4. Rs 51

  Answer :

  Option C

  Explanation:

  \begin{aligned}
  S.I. = \frac{P*R*T}{100} \\
  P = \frac{50*100}{5*2} = 500\\
  
  Amount = 500(1+\frac{5}{100})^2 \\
  500(\frac{21}{20} * \frac{21}{20}) \\
  = 551.25 \\
  
  C.I. = 551.25 - 500 = 51.25
  
  
  \end{aligned}

• 11. At what rate of compound interest per annum will a sum of Rs. 1200 become Rs. 1348.32 in 2 years

  1. 3%
  2. 4%
  3. 5%
  4. 6%

  Answer :

  Option D

  Explanation:

  Let Rate will be R%
  
  \begin{aligned}
  1200(1+\frac{R}{100})^2 = \frac{134832}{100} \\
  
  (1+\frac{R}{100})^2 = \frac{134832}{120000} \\
  
  (1+\frac{R}{100})^2 = \frac{11236}{10000} \\
  
  (1+\frac{R}{100}) = \frac{106}{100} \\
  => R = 6\%
  \end{aligned}

• 12. Albert invested amount of 8000 in a fixed deposit for 2 years at compound interest rate of 5 % per annum. How much Albert will get on the maturity of the fixed deposit.

  1. Rs. 8510
  2. Rs. 8620
  3. Rs. 8730
  4. Rs. 8820
  5. Only argument I is strong
  6. Only argument II is strong
  7. Either I or II is strong
  8. Neither I nor II is strong
  9. Both I and II are strong

  Answer :

  Option

  Explanation:

  \begin{aligned}
  => (8000 \times(1+\frac{5}{100})^2) \\
  => 8000 \times \frac{21}{20}\times \frac{21}{20} \\
  => 8820
  \end{aligned}
  

• 13. On a sum of money, simple interest for 2 years is Rs 660 and compound interest is Rs 696.30, the rate of interest being the same in both cases.

  1. 8%
  2. 9%
  3. 10%
  4. 11%

  Answer :

  Option D

  Explanation:

  Difference between C.I and S.I for 2 years = 36.30
  S.I. for one year = 330.
  S.I. on Rs 330 for one year = 36.30
  
  So R% = \frac{100*36.30}{330*1} = 11%

• 14. A sum of money invested at compound interest to Rs. 800 in 3 years and to Rs 840 in 4 years. The rate on interest per annum is.

  1. 4%
  2. 5%
  3. 6%
  4. 7%

  Answer :

  Option B

  Explanation:

  S.I. on Rs 800 for 1 year = 40
  
  Rate = (100*40)/(800*1) = 5%