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Compound Interest - Aptitude MCQ Questions and Solutions with Explanations

Compound Interest MCQ Questions and answers with easy and logical explanations.Arithmetic Ability provides you all type of quantitative and competitive aptitude mcq questions on Compound Interest with easy and logical explanations. Compound Interest MCQ is important for exams like Banking exams,IBPS,SCC,CAT,XAT,MAT etc. Page-4 section-2

Each section contains 100 MCQs on Compound Interest .
31
The compound interest (compounding annually) on a certain sum at the rate of 8 percent per annum for two years is Rs. 6656. What would be the simple interest on the same sum at the same rate of interest for two years?
Discuss
Answer & Solution
Answer: Option B
Solution:
Rate = 8%
Time = 2 years
Compound interest = 16.64% → 6656
1% → 400
Simple interest = 16% → 16 × 400 = 6400
32
At what rate percent per annum will a sum of Rs. 15,625 amount to Rs. 21,952 in three years, if the interest is compounded annually?
Discuss
Answer & Solution
Answer: Option A
Solution:
$$\eqalign{ & 15625:21952 \to {\text{in three years}} \cr & \root 3 \of {15625} :\root 3 \of {21952} \to {\text{in one year}} \cr} $$
Compound Interest mcq question image
$${\text{Rate}} = \frac{3}{{25}} \times 100 = 12\% $$
33
If the cost of a mobile phone is Rs. 25,000, available at Rs. 5,000 down payment followed by 3 equal annual instalments (each instalment is to be paid at the end of each year) at the rate 25% p.a. compound interest, then find the value of each instalment (rounded off to two decimal places):
Discuss
Answer & Solution
Answer: Option D
Solution:
Cash payment = 25000
Down payment = 5000
Remaining = 20000
Rate = 25% = $$\frac{1}{4}$$
\[\begin{array}{*{20}{c}} {100 = 4 \times 25}&{5 \times 25 = 125} \\ {80 = 16 \times 5}&{25 \times 5 = 125} \\ {64 = 64}&{125 - 125} \end{array}\]
244 unit → 20000
1 unit → 81.9672
Each installment
125 unit → 125 × 81.9672 = 10245.90 Answer
34
If the difference between the compound interest and simple interest on a certain sum of money for three years at 10% p.a. is Rs. 558. Then the sum is:
Discuss
Answer & Solution
Answer: Option B
Solution:
$$\eqalign{ & 3:3:1 \cr & \frac{{100:10:1}}{{300 + 30 + 1}} \cr & 31 \to 558 \cr & P \to 18000 \cr} $$
35
A sum of Rs. 15,000 is lent at 16% p.a. compound interest. What is the difference between the compound interest for the second year and the third year?
Discuss
Answer & Solution
Answer: Option B
No explanation is given for this question. Let's Discuss on Board
36
What is the difference (in Rs.) between the interests on Rs. 50,000 for one year at 8% per annum compounded half yearly and yearly?
Discuss
Answer & Solution
Answer: Option A
Solution:
$$\eqalign{ & 1{\text{ year CI}} = 1{\text{ year SI}} \cr & {\text{SI}} = \frac{{P \times R \times T}}{{100}} \cr & = \frac{{50000 \times 8 \times 1}}{{100}} \cr & = 4000 \cr & {\text{Compound interest at half yearly}} \cr & {\text{Rate}} = \frac{8}{2} = 4\% \cr & {\text{Time}} = 1 \times 2 = 2{\text{ years}} \cr & A = P{\left( {1 + \frac{R}{{100}}} \right)^n} \cr & A = 50000{\left( {1 + \frac{4}{{100}}} \right)^2} \cr & A = 50000 \times \frac{{104}}{{100}} \times \frac{{104}}{{100}} \cr & A = 5 \times 10816 \cr & A = 54080 \cr & {\text{CI}} = 54080 - 50000 = 4080 \cr & {\text{Difference between the interest of on year}} \cr & = 4080 - 4000 \cr & = 80 \cr} $$
37
A sum of money becomes Rs. 11,880 after 4 years and Rs. 17,820 after 6 years on compound interest, if the interest is compounded annually. What is the half of the sum (in Rs.)?
Discuss
Answer & Solution
Answer: Option B
Solution:
$$\eqalign{ & A = P{\left( {1 + \frac{R}{{100}}} \right)^n} \cr & 11880 = P{\left( {1 + \frac{R}{{100}}} \right)^4}.\,.\,.\,.\,.\,\left( {\text{i}} \right) \cr & 17820 = P{\left( {1 + \frac{R}{{100}}} \right)^6}.\,.\,.\,.\,.\,\left( {{\text{ii}}} \right) \cr & {\text{Equation }}\left( {{\text{ii}}} \right){\text{ divide by }}\left( {\text{i}} \right) \cr & \frac{{17820}}{{11880}} = {\left( {1 + \frac{R}{{100}}} \right)^2} \cr & \frac{3}{2} = {\left( {1 + \frac{R}{{100}}} \right)^2}.\,.\,.\,.\,.\,{\text{Put in equation}}\left( {\text{i}} \right) \cr & 11880 = P{\left( {1 + \frac{R}{{100}}} \right)^4} \cr & 11880 = P{\left( {1 + \frac{R}{{100}}} \right)^2}{\left( {1 + \frac{R}{{100}}} \right)^2} \cr & 11880 = P \times \frac{3}{2} \times \frac{3}{2} \cr & P = 11880 \times \frac{2}{3} \times \frac{2}{3} \cr & P = 5280 \cr & {\text{Half part of sum}} = \frac{1}{2} \times 5280 = 2640 \cr} $$
38
Rs. 4,000 is given at 5% per annum for one year and interest is compounded half yearly. Rs. 2,000 is given at 40% per annum compounded quarterly for 1 year. The total interest received is nearest to:
Discuss
Answer & Solution
Answer: Option C
Solution:
$${\bf{Case - I}}$$
Compound Interest mcq question image
$$\eqalign{ & = 100 + 100 + 2.5 = 202.5 \cr & {\bf{Case - II}} \cr & 2000 \cr & {\text{Rate of interest}} = \frac{{40}}{4} = 10\% \cr & 2000 \times \frac{{11}}{{10}} \times \frac{{11}}{{10}} \times \frac{{11}}{{10}} \times \frac{{11}}{{10}} \cr & = \frac{{14641}}{5} \cr & = 2928.2 \cr & {\text{Interest}} = 2928.2 - 2000 = 928.2 \cr & {\text{The total interest}} = 202.5 + 928.2 \cr & = 1130.7{\text{ Answer}} \cr} $$
39
What will be the compound interest on a sum of Rs. 31,250 for 2 years at 12% p.a., if the interest is compounded 8-monthly
Discuss
Answer & Solution
Answer: Option D
Solution:
$$\eqalign{ & 12\,{\text{months}} \to 12\% \cr & 8\,{\text{months}} \to 8\% \cr & 8\% \to \frac{2}{{25}} \cr} $$
Compound Interest mcq question image
40
A sum of money after a period of 2 years becomes Rs. 34,560, and it becomes Rs. 41,472 after a period of three years, being compounded at 'R' rate of interest. What is the value of R?
Discuss
Answer & Solution
Answer: Option A
Solution:
Compound Interest mcq question image
$$\eqalign{ & {\text{CI of 1 year}} = 41472 - 34560 = 6912 \cr & {\text{Rate }}\% = \frac{{6912}}{{34560}} \times 100 \cr & = 2 \times 10 \cr & = 20\% {\text{ Answer}} \cr} $$