The difference between simple interest and compound interest on Rs. 18000 for 2 years is Rs. 405. Find the rate of interest per annum. MCQ with Answer and Explanation
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Question #1
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At what rate of compound interest will Rs. 2000 amount to Rs. 2205 in 2 years?
Correct Answer: Option D
Explanation:
2000(1+r)² = 2205 ⇒ (1+r)² = 1.1025 = (1.05)² ⇒ r = 5%.
2000(1+r)² = 2205 ⇒ (1+r)² = 1.1025 = (1.05)² ⇒ r = 5%.
This question belongs to:
Maths
Compound Interest
Question #2
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The effective rate of interest for 10% per annum compounded half-yearly is:
Correct Answer: Option B
Explanation:
Effective rate = (1.05)² − 1 = 1.1025 − 1 = 0.1025 = 10.25%.
Effective rate = (1.05)² − 1 = 1.1025 − 1 = 0.1025 = 10.25%.
This question belongs to:
Maths
Compound Interest
Question #3
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The compound interest on a certain sum of money for 2 years at 5% per annum is Rs. 246. What is the sum?
Correct Answer: Option A
Explanation:
Effective compound interest rate for 2 years at 5% = 5 + 5 + (55)/100 = 10.25%. Given 10.25% of P = 246 => P = 246 / 0.1025 = Rs. 2400.
Effective compound interest rate for 2 years at 5% = 5 + 5 + (55)/100 = 10.25%. Given 10.25% of P = 246 => P = 246 / 0.1025 = Rs. 2400.
This question belongs to:
Maths
Compound Interest
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