The compound interest on Rs. 500 for 2 years at 4% per annum is: MCQ with Answer and Explanation

The compound interest on Rs. 500 for 2 years at 4% per annum is:

A. Rs. 41.60

B. Rs. 40.80

C. Rs. 42.40

D. Rs. 40.00

Answer: Option B

A = 500 × (1.04)² = 500 × 1.0816 = 540.80, CI = 540.80 − 500 = Rs. 40.80.

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 17 years. In how many years will it become 4 times of itself?

A. 42 years

B. 34 years

C. 26 years

D. 51 years

Correct Answer: Option B

Explanation:
The sum doubles (2^1) in 17 years. It will become 4 (2^2) times in 2 * 17 = 34 years.

This question belongs to: Maths Compound Interest

Question #2 Report Error

The simple interest on a sum for 2 years at 4% is Rs. 200. The compound interest on the same sum for 2 years at 4% is:

A. Rs. 202

B. Rs. 206

C. Rs. 204

D. Rs. 200

Correct Answer: Option C

Explanation:
P = 20000/(4×2) = 2500. CI = 2500 × [(1.04)² − 1] = 2500 × 0.0816 = 204.

This question belongs to: Maths Compound Interest

Question #3 Report Error

The compound interest on a sum for 2 years at 6% is Rs. 370.80. The sum is:

A. Rs. 3000

B. Rs. 3200

C. Rs. 2800

D. Rs. 3400

Correct Answer: Option A

Explanation:
CI = P × 0.1236 = 370.80 ⇒ P = 3000.

This question belongs to: Maths Compound Interest