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What will be the difference between simple and compound interest @ 10% per annum on the sum of Rs 1000 after 4 years

A.

Rs 63.10

B.

Rs 64.10

C.

Rs 65.10

D.

Rs 62.10

Answer with explanation

Answer: Option BExplanation

So the difference between simple interest and compound interest will be 464.10 – 400 = 64.10

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The compound interest accrued on an amount of Rs.44000 at the end of two years is Rs.1193.60. What would be the simple interest accrued on the same amount at the same rate in the same period?

A.

Rs.10,560

B.

Rs.10,280

C.

Rs.10,840

D.

Rs.10,720

Answer with explanation

Answer: Option AExplanation

Let the rate of interest be R% p.a.

4400{[1 + R/100]^{2} – 1} = 1193.60

[1 + R/100]^{2} = [(44000 + 1193.60)**/**44000]

[1 + R/100]^{2} =[ (1 + 2544)*/*1000] = 1 + 159/625

[1 + R/100]^{2} = 784/625 = (28/25)^{2}

1 + R/100 = 28/25

R/100 = 3/25

Therefore R = 12 SI on Rs.44000 at 12% p.a. for two years = 44000(2)(12)/100

=Rs.10560

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What will be the amount if a sum of Rs. 10000 is placed at compound interest for 3 years while rate of interest for the first, second and third years is 2, 5 and 10 percent, respectively?

A.

Rs. 11231

B.

Rs. 11658

C.

Rs. 11781

D.

Rs. 11244

Answer with explanation

Answer: Option CExplanation

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The compound interest on a sum of money for 2 years is rs.832 and the simple interest on the same sum for the same period is rs.800 .the difference between the compound interest and simple interest for 3 years

A.

Rs.66.56

B.

Rs.90

C.

Rs.48

D.

Rs.98.56

Answer with explanation

Answer: Option DExplanation

Given that simple interest for 2 years is Rs.800

i.e., Simple interest for 1st year is Rs.400

and simple interest for 2nd year is also Rs.400

Compound interest for 1st year will be 400

and Compound interest for 2nd year will be 832 – 400 = 432

you can see that compound interest for 2nd year is more than simple interest for 2nd year by 432 – 400 = Rs.32

i.e, Rs. 32 is the interest obtained for Rs.400 for 1 year

Difference between compound and simple interest for the 3rd year

= Simple Interest obtained for Rs.832

Total difference between the compound and simple interest for 3 years

= 32 + 66.56 = Rs.98.56

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Simple interest on a certain sum of money for 3 years at 8% per annum is half the compound interest on Rs. 4000 for 2 years at 10% per annum. The sum placed on simple interest is:

A.

Rs. 2000

B.

Rs. 1550

C.

Rs. 1750

D.

Rs. 1650

Answer with explanation

Answer: Option CExplanation

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If the difference between the simple interest and compound interests on some principal amount at 20% for 3 years is Rs. 48, then the principal amount is

A.

400

B.

375

C.

636

D.

650

Answer with explanation

Answer: Option BExplanation

For three years

Sum = Difference x (100)^3 **/** r^2(300 + r)

====== >>>> 48 x (100)^3 **/** 20^2 (300 + 20)

======>>>> Rs. 375

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If the simple interest on a sum of money at 5% per annum for 3 years is Rs. 1200, find the compound interest on the same sum for the same period at the same rate.

A.

1281

B.

1271

C.

1291

D.

1261

Answer with explanation

Answer: Option DExplanation

Clearly, Rate = 5% p.a., Time = 3 years, S.I.= Rs. 1200. . .

So principal= RS [100*1200] / 3*5 =RS 8000

Amount = Rs. 8000 x [1 +5/100]^3 – = Rs. 9261.

.. C.I. = Rs. (9261 – 8000) = Rs. 1261.

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If Rs. 7200 amounts to Rs.10368 at compound interest in a certain time, then Rs. 7200 amounts to what in half of the time?

A.

8800

B.

8640

C.

8520

D.

8600

Answer with explanation

Answer: Option BExplanation

Let rate = R% and time = n year

Then, 10368 =7200(1+R/100)n

⇒ (1+R/100)n = 10368/7200 = 1.44

∴ (1 + R/100)n/2 = √1.44 = 1.2

∴ Required amount for n/2 yr

= 7200(1+ R/100)n/2

= 7200 x 1.2 = Rs. 8640

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Find the compound interest on Rs.16,000 at 20% per annum for 9 months, compounded quarterly

A.

Rs 2521

B.

Rs 2523

C.

Rs 2522

D.

Rs 2520

Answer with explanation

Answer: Option CExplanation

Please remember, when we have to calculate C.I. quarterly then we apply the following formula if n is the number of years

Principal = Rs.16,000;

Time=9 months = 3 quarters;

Rate = 20%, it will be 20/4 = 5%

So let’s solve this question now,

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The compound interest on a certain sum for 2 years at 10% per annum is Rs. 525. The simple interest on the same sum for double the time at half the rate percent per annum is:

A.

600

B.

400

C.

300

D.

500

Answer with explanation

Answer: Option DExplanation

Let the sum be Rs. P.

Amount after 2 years at 10% per annum when interest is compounded annually

Given that compound interest = 525

Simple interest on the same sum(Rs.2500) for 4 years at 5%

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The difference between the simple interest on a certain sum at the rate of 10%per annum for 2 years and compound interest which is compounded every 6 months is Rs.124.05. what is the principal sum

A.

Rs. 4000

B.

Rs. 6000

C.

Rs. 8000

D.

Rs. 10000

Answer with explanation

Answer: Option CExplanation

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