The effective rate of interest for 5% per annum compounded half-yearly is: MCQ with Answer and Explanation

Question Report Error

The effective rate of interest for 5% per annum compounded half-yearly is:

A. 5.05%

B. 5.0625%

C. 5.12%

D. 5.10%

Answer: Option B

Solution (By JKExamLibrary)

Effective rate = (1.025)² − 1 = 1.050625 − 1 = 5.0625%.

This question belongs to: Maths Compound Interest

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Practice More Compound Interest Questions

Question #1 Report Error

What sum will amount to Rs. 1210 in 2 years at 10% per annum compound interest?

A. Rs. 1100

B. Rs. 900

C. Rs. 1200

D. Rs. 1000

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Correct Answer: Option D

Explanation:
P = 1210 / (1.1)² = 1210 / 1.21 = 1000.

This question belongs to: Maths Compound Interest

Question #2 Report Error

The population of a town increases by 10% per annum. If the present population is 6050, what was it 2 years ago?

A. 5800

B. 5500

C. 5000

D. 6000

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Correct Answer: Option C

Explanation:
Population 2 years ago = 6050 / (1.1)² = 6050 / 1.21 = 5000.

This question belongs to: Maths Compound Interest

Question #3 Report Error

A sum of money at compound interest becomes 6 times in 3 years. In how many years will it become 36 times?

A. 5 years

B. 9 years

C. 4 years

D. 6 years

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Correct Answer: Option D

Explanation:
36 = 6², so 3 × 2 = 6 years.

This question belongs to: Maths Compound Interest

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