The effective annual rate for 11% per annum compounded half-yearly is: MCQ with Answer and Explanation
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Question #1
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In how many years will Rs. 5000 amount to Rs. 6655 at 10% compound interest?
Correct Answer: Option B
Explanation:
5000(1.1)^t = 6655 ⇒ (1.1)^t = 1.331 = (1.1)³ ⇒ t = 3.
5000(1.1)^t = 6655 ⇒ (1.1)^t = 1.331 = (1.1)³ ⇒ t = 3.
This question belongs to:
Maths
Compound Interest
Question #2
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Find the compound interest on Rs. 100000 for 1 year at 16% per annum, compounded quarterly.
Correct Answer: Option A
Explanation:
Quarterly rate = 16 / 4 = 4%. Time = 4 quarters. Amount = 100000 * (1 + 4/100)^4 = 100000 * (1.04)^4 = 100000 * 1.16985856 = Rs. 116985.86. Compound Interest = 116985.86 - 100000 = Rs. 16985.86.
Quarterly rate = 16 / 4 = 4%. Time = 4 quarters. Amount = 100000 * (1 + 4/100)^4 = 100000 * (1.04)^4 = 100000 * 1.16985856 = Rs. 116985.86. Compound Interest = 116985.86 - 100000 = Rs. 16985.86.
This question belongs to:
Maths
Compound Interest
Question #3
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In how many years will Rs. 2500 amount to Rs. 2756.25 at 5% per annum compound interest?
Correct Answer: Option B
Explanation:
2500(1.05)^t = 2756.25 ⇒ (1.05)^t = 1.1025 ⇒ t = 2.
2500(1.05)^t = 2756.25 ⇒ (1.05)^t = 1.1025 ⇒ t = 2.
This question belongs to:
Maths
Compound Interest
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