What is the compound interest on Rs. 20000 for 2 years if the rate of interest is 5% for the first year and 10% for the second year? MCQ with Answer and Explanation
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Question #1
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At what rate percent per annum will Rs. 8000 amount to Rs. 8820 in 2 years, compound interest compounded annually?
Correct Answer: Option B
Explanation:
Amount/Principal = 8820 / 8000 = 882 / 800 = 441 / 400 = (21 / 20)^2. Therefore, 1 + R/100 = 21/20 => R/100 = 1/20 => R = 5%.
Amount/Principal = 8820 / 8000 = 882 / 800 = 441 / 400 = (21 / 20)^2. Therefore, 1 + R/100 = 21/20 => R/100 = 1/20 => R = 5%.
This question belongs to:
Maths
Compound Interest
Question #2
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Find the compound interest on Rs. 14400 at 5% per annum for 2 years.
Correct Answer: Option B
Explanation:
A = 14400 × 1.1025 = 15876, CI = 15876 − 14400 = Rs. 1476.
A = 14400 × 1.1025 = 15876, CI = 15876 − 14400 = Rs. 1476.
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. 328. What would be the simple interest on the same sum at the same rate for the same time?
Correct Answer: Option A
Explanation:
Effective rate of compound interest for 2 years at 5% = 5 + 5 + (55)/100 = 10.25%. Simple interest rate = 5 * 2 = 10%. Given 10.25% of sum = 328 => 1% of sum = 32. Simple Interest = 10% of sum = 10 * 32 = Rs. 320.
Effective rate of compound interest for 2 years at 5% = 5 + 5 + (55)/100 = 10.25%. Simple interest rate = 5 * 2 = 10%. Given 10.25% of sum = 328 => 1% of sum = 32. Simple Interest = 10% of sum = 10 * 32 = Rs. 320.
This question belongs to:
Maths
Compound Interest
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