Compound Interest Quiz Set 001 | Maths Aptitude Quiz Questions and Mock Test on Compound Interest Set 1 | mock tests for Bank PO, SSB/SSC Exams, SO Clerical Exam, GATE Exam, LIC AO, GIC AO, etc.

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Question 1

What is compound interest on Rs. 80000 after 2 years, invested at a rate of 6% compounded annually?

Rs. 9888.

Rs. 9988.

Rs. 9788.

Rs. 10088.

Soln.
Ans: a

The shortcut formula is CI = Pr(r + 200)/10000. Putting P = 80000, r = 6, we get ${80000 × 6 × (6 + 200)}/10000$ = Rs. 9888.

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Question 2

The compound amount after 2 years on a principal of Rs. P is same as that on a principal of Rs. (1035 - P) after 3 years, then what is P if the rate of interest is 7% p.a. compounded yearly?

Rs. 535.

Rs. 635.

Rs. 435.

Rs. 735.

Soln.
Ans: a

We have P × $(1 + 7/100)^2$ = (1035 - P) × $(1 + 7/100)^3$. Cancelling, we get P = (1035 - P) × (1 + 7/100). Simplifying, P = ${1035 × (100 + 7)}/(200 + 7)$, which gives P = Rs. 535.

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Question 3

When a certain amount is invested in a simple interest scheme, it increases by 30% in 3 years. What will be compound interest after 3 years on an amount of Rs. 8000, at the same interest rate, and annual compounding?

Rs. 2648.

Rs. 2748.

Rs. 2548.

Rs. 2848.

Soln.
Ans: a

Simple interest on Rs. 100 in 3 years is Rs. 30, so rate is 30/3 = 10%. Compound interest for 3 years would be 8000 × $(1 + 10/100)^3$ = 8000 × $(11/10)^3$ = $(8000 × 11 × 11 × 11)/1000$ = Rs. 10648. Interest = A - P = 10648 - 8000 = Rs. 2648.

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Question 4

What is the difference between the simple interest and compound interest at the rate of 8% for 1 year? The compounding is half-yearly, and the principal is Rs. 30000.

Rs. 48.

Rs. 148.

Rs. 98.

Rs. 248.

Soln.
Ans: a

The simple interest SI = (P × r)/100 = (30000 × 8)/100 = Rs. 2400. Compound interest will have half interest rate and n = 2. By shortcut formula, we have CI = ${P × R × (R + 200)}/10000$ = ${30000 × 4 × (4 + 200)}/10000$ = Rs. 2448. The difference = Rs. 48.

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Question 5

What is the difference between the simple interest and compound interest at the rate of 8% for 1 year? The compounding is half-yearly, and the principal is Rs. 70000.

Rs. 112.

Rs. 212.

Rs. 162.

Rs. 312.

Soln.
Ans: a

The simple interest SI = (P × r)/100 = (70000 × 8)/100 = Rs. 5600. Compound interest will have half interest rate and n = 2. By shortcut formula, we have CI = ${P × R × (R + 200)}/10000$ = ${70000 × 4 × (4 + 200)}/10000$ = Rs. 5712. The difference = Rs. 112.

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