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Quantitative Aptitude - Arithmetic Ability/
Compound Interest

Compound Interest Questions

Popular Latest Rated Important Formulae

FACTS AND FORMULAE FOR COMPOUND INTEREST QUESTIONS

Let Principal = P, Rate = R% per annum, Time = n years.

1. When interest is compound Annually:

Amount = $P {(1 + \frac{R}{100})}^{n}$

2. When interest is compounded Half-yearly:

Amount = $P {[1 + \frac{(\frac{R}{2})}{100}]}^{2 n}$

3. When interest is compounded Quarterly:

Amount = $P {[1 + \frac{(\frac{R}{4})}{100}]}^{4 n}$

II.

1. When interest is compounded Annually but time is in fraction, say $3 \frac{2}{5}$ years.

Amount = $P {(1 + \frac{R}{100})}^{3} \times (1 + \frac{\frac{2}{5} R}{100})$

2. When Rates are different for different years, say R1%, R2%, R3% for 1st, 2nd and 3rd year respectively.

Then, Amount = $P (1 + \frac{R_{1}}{100}) (1 + \frac{R_{2}}{100}) (1 + \frac{R_{3}}{100})$

III. Present worth of Rs. x due n years hence is given by:

Present Worth = $\frac{x}{{(1 + \frac{R}{100})}^{n}}$

At what rate of compound interest per annum will a sum of Rs 20000 become Rs 25088 in 2 years?

A) 24 percent	B) 8 percent
C) 12 percent	D) 16 percent

A) 24 percent

B) 8 percent

C) 12 percent

D) 16 percent

Answer & Explanation Answer: C) 12 percent

Explanation:

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0 1440

The difference between the compound interest (compounding annually) and simple interest on a sum at the rate of 12% per annum for 2 years is Rs 360. What is the sum (in Rs)?

A) 27000	B) 32000
C) 30000	D) 25000

A) 27000

B) 32000

C) 30000

D) 25000

Answer & Explanation Answer: D) 25000

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9 1436

A certain sum when invested at 5% interest compounded annually for 3 years yields an interest of Rs.2522. Find the Principal?

A) Rs. 12,522	B) Rs. 15,200
C) Rs. 16,000	D) Rs. 17,200

A) Rs. 12,522

B) Rs. 15,200

C) Rs. 16,000

D) Rs. 17,200

Answer & Explanation Answer: C) Rs. 16,000

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6 1436

If compound interest received on a certain amount in the 3rd year is Rs. 1,240, what will be the compound interest (in Rs) for the 4th year on the same amount at 9% rate of interest?

A) 1245.6	B) 1521.6
C) 1351.6	D) 1220.6

A) 1245.6

B) 1521.6

C) 1351.6

D) 1220.6

Answer & Explanation Answer: C) 1351.6

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0 1432

The amount received at 10% per annum compound interest after 3 yrs is Rs 10,648. What was the principal (in Rs)?

A) 8000	B) 9000
C) 8500	D) 7500

A) 8000

B) 9000

C) 8500

D) 7500

Answer & Explanation Answer: A) 8000

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1 1431

A sum of Rs 10000 becomes Rs 14641 when invested at compound interest at the yearly interest rate of 20% per annum. If the compounding is done half yearly, then for how many years was the sum invested?

A) 1	B) 2
C) 3	D) 4

A) 1

B) 2

C) 3

D) 4

Answer & Explanation Answer: B) 2

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2 1422

There is 40% increase in an amount in 5 years at simple interest. What will be the compound interest of Rs. 25000 after 3 years at the same rate?

A) Rs 6492.8	B) Rs 12985.6
C) Rs 16232	D) Rs 9739.2

A) Rs 6492.8

B) Rs 12985.6

C) Rs 16232

D) Rs 9739.2

Answer & Explanation Answer: A) Rs 6492.8

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0 1419

The difference between simple and compound interests compounded annually on a certain sum of money for 2 years at 18% per annum is Rs 81. The sum is ____.