A sum of money becomes 4 times in 2 years at compound interest. The rate of interest per annum is: MCQ with Answer and Explanation

A sum of money becomes 4 times in 2 years at compound interest. The rate of interest per annum is:

A. 200%

B. 75%

C. 100%

D. 50%

Answer: Option C

P(1 + r)² = 4P ⇒ (1+r)² = 4 ⇒ 1+r = 2 ⇒ r = 1 = 100%.

This question belongs to: Maths Compound Interest

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Question #1 Report Error

A sum of money invested at compound interest doubles itself in 16 years. In how many years will it become 4 times of itself?

A. 48 years

B. 24 years

C. 40 years

D. 32 years

Correct Answer: Option D

Explanation:
The sum doubles (2^1) in 16 years. It will become 4 (2^2) times in 2 * 16 = 32 years.

This question belongs to: Maths Compound Interest

Question #2 Report Error

If Rs. 5000 becomes Rs. 5832 in 2 years at compound interest, the rate is:

A. 7%

B. 8%

C. 6%

D. 9%

Correct Answer: Option B

Explanation:
5000(1+r)² = 5832 ⇒ (1+r)² = 1.1664 = (1.08)² ⇒ r = 8%.

This question belongs to: Maths Compound Interest

Question #3 Report Error

The compound interest on a sum for 2 years at 5% is Rs. 205. Find the sum.

A. Rs. 1900

B. Rs. 2000

C. Rs. 2100

D. Rs. 2200

Correct Answer: Option B

Explanation:
CI = P[(1.05)² − 1] = P × 0.1025 = 205 ⇒ P = 2000.

This question belongs to: Maths Compound Interest