Simple & Compound Interest Solved Questions For IBPS, SBI and Other Bank Exams - Page 1

You will find 11 problems in 3 pages..

Simple & Compound Interest Solved Questions (Page 1 of 3)

Dear Reader,

Below you will find important formulas of simple and compound problems. Following that you will find solved questions. These questions will help you in preparation for all bank exams including IBPS, SBI, RRB and other banks.

Simple Interest
SI- Simple Interest, CI – Compound Interest, P- Principal, R-Rate of interest, T- number of years, A – Amount

Important formulas:

1. SI = PRT/100
2. P = (100 x SI) / (R x T)
3. R = (100 x SI) / (P x T)
4. T = (100 x SI) / (P x R)
5. P = 100A/100+RT
6. A = P+SI

Important formulas:

7. A = P(1+R/100)T
8. CI = P[(1+R/100) T -1]
9. If interest is compounded half yearly
A = P(1+(R/200))2T
10. If interest is compounded quarterly
A = P(1+(R/400))4T
11. If interest is compounded annually and time is in fractional form Tx/y
A = P(1+R/100) T x (1+(x/y)R/100)
12. If rates are different for different years, i.e.,R1%, R2%,R3% for 1st, 2nd & 3rd year then,
A = P(1+R1/10) (1+R2/100) (1+R3/100)

Question 1

Veer invested an amount of Rs.9000 for 2 years at compound interest rate 15% per annum. How much amount will Veer obtain as interest?
a)Rs.2902.50 b)Rs.2900.50 c)Rs.2899.50 d)Rs.2899

Answer : a)Rs.2902.50

Solution:

When interest is compounded Annually, we have to use the following formula:

Amount = P x [1+ (R/100)]n where P = principal, R = rate of interest and n = time(years)

Here P = Rs.9000, R = 15%, n = 2 years.

Then, Amount= Rs.9000 x [1 + (15/100)]2 = 9000 x (23/20)2 = 23805/2 = Rs.11902.5

The amount obtained by the way of interest in compound interest = Amount - principal = Rs.(11902.5 - 9000) = Rs.2902.50

Hence the required answer is Rs.2902.50


Question 2

Shagi deposits Rs.1500 each on 1st January and 1st July of a year at the rate of 8% compound interest calculated on half-yearly basis. How much amount he would have at the end of the year?
a)Rs.2150.50 b)Rs.3140.40 c)Rs.3182.40 d)Rs.2152.50

Answer : c) Rs.3182.40

Solution:

When interest is compounded Half-yearly: Amount = P x [1+ (R/2)/100 ]2n
The total amount for the investment on 1st january is:
Amount1 = Rs. 1500 x [1+ (8/2)/100]2x1
= Rs. 1500 x [1 + (4/100)]2
= Rs. 1500 x [26/25]2

The total amount for investment on 1st july is:
(Here n= 1/2 year since it starts from 1st july to end of the same year)
Amount2 = Rs. 1500 x [1+ (8/2)/100][2 x(1/2)]
= Rs. 1500 x [1+ 4/100 ]
= Rs. 1500 x [26/25]

The total amount at the end of the year = amount1 + amount2
= 1500 x [26/25]2 + 1500 x [26/25]
= 1500 x [26/25] x [(26/25) + 1]
= 1500 x 26/25 x 51/25
= 3182.40

Hence Rs.3182.40 is the required answer.


Question 3

What is the difference between the compound interests on Rs.10,000 for 2 years at 5% per annum compounded yearly and half-yearly?
a)Rs.6.00 b)Rs.6.25 c)Rs.6.50 d)Rs.6.75

Answer : b)Rs.6.25

Solution:

Here, P = Rs.10,000, n = 2 years, and R = 5%

Amount invested for compound interest (yearly) = Rs. 10000 x [1 + 5/100] = Rs.10000 x 21/20 = Rs.10,500

Amount invested for compound interest (Half-yearly) = Rs. 10000 x [1 +(5/2)/100]2 = 10000 x (41/40)2 = Rs.10,506.25

Difference = Rs.(10506.25-10500) = Rs.6.25


Simple & Compound Interest Solved Questions (Page 1 of 3)

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