1
Q:

# Find the effective rate of interest for an investment that earns 5 1/2% per year, compounded continuously

 A) 5.65% B) 5.75% C) 5.85% D) 5.95%

Explanation:

We are not given a value of P in this problem, so either pick a value

for P and stick with that throughout the problem, or just let P = P.

We have that t = 1, and r = .055. To find the effective rate of interest,

first find out how much money we have after one year:

A = Pert

A = Pe(.055)(1)

A = 1.056541P.

Therefore, after 1 year, whatever the principal was, we now have 1.056541P.

Next, find out how much interest was earned, I, by subtracting the initial amount of money from the final amount:

I = A − P

= 1.056541P − P

= .056541P.

Finally, to find the effective rate of interest, use the simple interest formula, I = Prt. So,

I = Pr(1) = .056541P

.056541 = r.

Therefore, the effective rate of interest is 5.65%

Q:

The difference between compound interest and simple interest on ₹ x at 8% per annum for 2 years is ₹ 48. What is the value of x?

 A) 7500 B) 7400 C) 8000 D) 7800

Explanation:

0 26
Q:

The difference between the compound interest and simple interest on Rs. x at 12% per annum for 2 years is ₹43.20. What is the value of x?

 A) 3,000 B) 2,500 C) 2,800 D) 2,400

Explanation:

0 57
Q:

The difference between the compound interest and simple interest on ₹x at 7% per annum for 2 years is ₹24.50. What is the value of x?

 A) 5,000 B) 4,800 C) 6,000 D) 5,400

Explanation:

0 373
Q:

A sum of Rs. 8,000 invested at 10% p.a. amounts to Rs. 9,261 in a certain time, interest compounded half-yearly. What will be the compound interest (in Rs. ) on the same sum for the same time at double the earlier rate of interest, when interest is compounded annually?

 A) Rs. 2,560 B) Rs. 2,480 C) Rs. 2,500 D) Rs. 2,520

Explanation:

3 492
Q:

The compound interest on a certain sum at 16 2/3% p.a. for 3 years is Rs.6,350. What will be the simple interest on the same sum at the same rate for 5 2/3 years?

 A) ₹10,200 B) ₹11,400 C) ₹7,620 D) ₹9,600

Explanation:

2 1895
Q:

A and B together borrowed a sum of Rs.51,750 at an interest rate of 7% p.a. compound interest in such a way that to settle the loan, A paid as much amount after three years as paid by B after 4 years from the day of borrowing. The sum (in Rs) borrowed by B was:

 A) 25,650 B) 26,750 C) 25,000 D) 24,860

Explanation:

1 5622
Q:

A certain amount of money at compound interest grows to Rs.66,550 in 3 years and Rs.73,205 in 4 years. The rate percent per annum is:

 A) 9% B) 5% C) 11% D) 10%

Explanation:

0 4648
Q:

A sum lent out at compound interest amounts to Rs. 1,250 in one year and to Rs. 1,458 in 3 years at a certain rate percentage p.a. What is the simple interest on the same sum for 27/5 years at the same rate of interest?

 A) Rs. 600 B) Rs. 520 C) Rs. 500 D) Rs. 480