What sum will amount to Rs. 11576.25 in 2 years at 5% per annum compound interest? MCQ with Answer and Explanation
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Practice More Compound Interest Questions
Question #1
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A sum of money at compound interest becomes 10 times in 2 years. In how many years will it become 100 times?
Correct Answer: Option B
Explanation:
100 = 10², so 2 × 2 = 4 years.
100 = 10², so 2 × 2 = 4 years.
This question belongs to:
Maths
Compound Interest
Question #2
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The effective annual rate for 9% per annum compounded half-yearly is:
Correct Answer: Option D
Explanation:
Half-yearly rate 4.5%, (1.045)² = 1.092025, effective = 9.2025% ≈ 9.20%.
Half-yearly rate 4.5%, (1.045)² = 1.092025, effective = 9.2025% ≈ 9.20%.
This question belongs to:
Maths
Compound Interest
Question #3
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The compound interest on a certain sum for 2 years at 10% per annum is Rs. 420. What would be the simple interest on the same sum at the same rate for the same time?
Correct Answer: Option B
Explanation:
For 2 years at 10%, effective compound interest rate is 10 + 10 + (1010)/100 = 21%. Effective simple interest rate is 10 * 2 = 20%. Given 21% of sum = 420, then 1% of sum = 20. Simple Interest = 20% of sum = 20 * 20 = Rs. 400.
For 2 years at 10%, effective compound interest rate is 10 + 10 + (1010)/100 = 21%. Effective simple interest rate is 10 * 2 = 20%. Given 21% of sum = 420, then 1% of sum = 20. Simple Interest = 20% of sum = 20 * 20 = Rs. 400.
This question belongs to:
Maths
Compound Interest
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