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 Simple Interest Questions

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FACTS  AND  FORMULAE  FOR  SIMPLE  INTEREST  QUESTIONS

 

 

1. Principal: The money borrowed or lent out for a certain period is called the principal or the sum.

 

2. Interest: Extra money paid for using other's money is called interest

 

3. Simple Interest (S.I.) : If the interest on a sum borrowed for a certain period is reckoned uniformly, then it is called simple interest.

Let Principal = P, Rate = R% per annum (p.a.) and Time = T years. Then,

(i)  S.I=P×T×R100

(ii)  P=100×S.IR×T ; R=100×S.IP×T and T=100×S.IP×R

Q:

A sum of money invested for a certain number of years at 8% p.a. simple interest grows to Rs.180. The same sum of money invested for the same number of years at 4% p.a. simple interest grows to Rs.120 only. For how many years was the sum invested?

A) 25years B) 15years
C) 20years D) 22years
 
Answer & Explanation Answer: A) 25years

Explanation:

From the information provided we know that,

Principal + 8% p.a. interest on principal for n years = 180 …….. (1)

Principal + 4% p.a. interest on principal for n years = 120 ……… (2)

Subtracting equation (2) from equation (1), we get

4% p.a. interest on principal for n years = Rs.60.

Now, we can substitute this value in equation (2),

i.e Principal + 60 = 120

= Principal = Rs.60.

We know that SI = , where p is the principal, n the number of years and r the rate percent of  interest.

In equation (2), p = Rs.60, r = 4% p.a. and the simple interest = Rs.60.

Therefore, 60 =(60*n*4)/100

=> n = 100/4 = 25 years.

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Q:

A sum of money amounts to Rs. 9800 after 5 years and Rs. 12005 after 8 years at the same rate of simple interest. The rate of interest per annum is:

A) 5% B) 8%
C) 12% D) 15%
 
Answer & Explanation Answer: C) 12%

Explanation:

 

S.I. for 3 years = Rs. (12005 - 9800) = Rs. 2205.

 

S.I. for 5 years = Rs.22053×5= Rs.3675

 

Principle = Rs.(9800-3675) = Rs.6125

 

Hence, Rate = 100×36756125×5 =12%

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Q:

A person takes a loan of Rs. 200 at 5% simple interest. He returns Rs.100 at the end of one year. In order clear his dues at the end of 2 years, he would pay : 

A) Rs. 100 B) Rs. 105
C) Rs. 115 D) Rs. 110
 
Answer & Explanation Answer: C) Rs. 115

Explanation:

Amount to be paid = Rs.100+200×5×1100+100×5×1100= Rs. 115.

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Q:

Question :

What is the sum which earned interest ?

Statements :

a. The total simple interest was Rs. 9000 after 9 years.
b. The total of sum and simple interest was double of the sum after 6 years.

A) Only a is sufficient B) Neither a nor b is sufficient
C) Only b is sufficient D) Both a and b sufficient
 
Answer & Explanation Answer: D) Both a and b sufficient

Explanation:

Let the sum be Rs. x

a. gives, S.I = Rs. 9000 and time = 9 years.

b. gives, Sum + S.I for 6 years = 2 x Sum

--> Sum = S.I for 6 years.


Now, S.I for 9 years = Rs. 9000

S.I for 1 year = Rs. 9000/9 = Rs. 1000.

S.I for 6 years = Rs. (1000 x 6)= Rs. 6000.

--> x = Rs. 6000

Thus, both a and b are necessary to answer the question.

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3 16975
Q:

A sum of money triples itself in 8 years simple interest. Find the rate of percent per annum?

A) 30% B) 25%
C) 22% D) 18%
 
Answer & Explanation Answer: B) 25%

Explanation:

The rate of percent R is given by,

exp.

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47 16481
Q:

If the C.I. on a sum for 2 years at 12 1/2 % per annum is Rs. 510, the S.I. on the same sum at the same rate for the same period of time is   ?

A) Rs. 580 B) Rs. 480
C) Rs. 550 D) Rs. 470
 
Answer & Explanation Answer: B) Rs. 480

Explanation:

Let the sum be Rs. P. Then,

 

P1+252x1002-P= 510

 

P[982- 1] = 510.

 

Sum = Rs. 1920

 

So, S.I. = (1920 x 25 x 2) / (2 x 100) = Rs. 480

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Q:

Rs.1500 is divided into two parts such that if one part is invested at 6% and the other at 5% the whole annual interest from both the sum is Rs.85. How much was lent at 5% ?

A) Rs. 500 B) Rs. 245
C) Rs. 1250 D) Rs. 635
 
Answer & Explanation Answer: A) Rs. 500

Explanation:

(kx5x1)/100 + [(1500 - k)x6x1]/100 = 85

5k/100 + 90 – 6k/100 = 85

k/100 = 5

=> k = 500

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Q:

The simple interest on Rs. 25 for 4 months at the rate of 3 paise per rupee per month is :

A) 240 paise B) Rs. 1.40
C) Rs. 2.20 D) Rs. 3
 
Answer & Explanation Answer: D) Rs. 3

Explanation:

I = PTR/100
I = 25 x 4 x 0.03/100
I = 0.03 x 100 = 300 Ps = Rs. 3

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