The difference between simple interest and compound interest on a certain sum of money for 2 years at 10% per annum is Rs. 100. Find the sum. MCQ with Answer and Explanation
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Question #1
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A sum of money at compound interest becomes 5 times in 3 years. In how many years will it become 25 times?
Correct Answer: Option A
Explanation:
5 times in 3 years; 25 = 5², so 3 × 2 = 6 years.
5 times in 3 years; 25 = 5², so 3 × 2 = 6 years.
This question belongs to:
Maths
Compound Interest
Question #2
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The compound interest on a certain sum for 2 years at 5% per annum is Rs. 820. Find the principal sum.
Correct Answer: Option D
Explanation:
Effective rate of compound interest for 2 years at 5% = 5 + 5 + (55)/100 = 10.25%. Given 10.25% of P = 820 => P = 820 / 0.1025 = Rs. 8000.
Effective rate of compound interest for 2 years at 5% = 5 + 5 + (55)/100 = 10.25%. Given 10.25% of P = 820 => P = 820 / 0.1025 = Rs. 8000.
This question belongs to:
Maths
Compound Interest
Question #3
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What is the effective rate of interest corresponding to 12% per annum compounded half-yearly?
Correct Answer: Option A
Explanation:
Effective rate = (1.06)² − 1 = 1.1236 − 1 = 12.36%.
Effective rate = (1.06)² − 1 = 1.1236 − 1 = 12.36%.
This question belongs to:
Maths
Compound Interest
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