PRACTICE QUESTIONS ON SIMPLE AND COMPOUND INTEREST

Examination Questions on SIMPLE AND COMPOUND INTEREST

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Amount = Principle + Interest
Simple Interest = (Principle x Rate of Interest X Time period)/100
Compound Interest = Principle(1 + r/100)n – Principle

r = rate of interest and n = time period

1. A sum of money becomes 3 times in 5 years. In how many years will the same sum become 6 times at the same rate of simple interest?  

  1. 15 years
  2. 12.5 years
  3. 10 years
  4. 7.5 years

2. What is the compound interest on Rs. 1600 at 25% per annum for 2 years compounded annually?  

  1. Rs. 700
  2. Rs. 750
  3. Rs. 800
  4. Rs. 900

3. A certain sum at simple interest amounts to Rs. 1350 in 5 years and to Rs. 1620 in 8 years. What is the sum?  

  1. Rs. 700
  2. Rs. 800
  3. Rs. 900
  4. Rs. 1000

4. The sum which amounts to Rs. 364.80 in 8 years at 3.5% simple interest per annum is:  

  1. Rs. 285
  2. Rs. 280
  3. Rs. 275
  4. Rs. 270

5. What is the least number of complete years in which a sum of money at 20% compound interest will be more than doubled?  

  1. 7
  2. 6
  3. 5
  4. 4

6. A sum of money on compound interest amounts to Rs. 9,680 in 2 years and to Rs. 10,648 in 3 years. What is the rate of interest per annum?  

  1. 5%
  2. 10%
  3. 15%
  4. 20%

7. A sum of money lent on simple interest trebles itself in 15 years and 6 months. In how many years will it be doubled?  

  1. 6 years and 3 months
  2. 7 years and 9 months
  3. 8 years and 3 months
  4. 9 years and 6 months

8. The simple interest on a certain sum of money for 3 years at 8% per annum is half the compound interest on Rs. 4,000 for 2 years at 10% per annum. What is the sum placed on simple interest?  

  1. Rs. 1,550/-
  2. Rs. 1,650/-
  3. Rs. 1,750/-
  4. Rs. 2,000/-


9. A person invested some amount at the rate of 12% simple interest and the remaining at 10%. He received yearly an interest of Rs. 130. Had he interchanged the amounts invested, he would have received an interest of Rs. 134. How much money did he invest at different rates?  

  1. Rs. 500 @ 10%, Rs. 800 @ 12%
  2. Rs. 700 @ 10%, Rs. 600 @ 12%
  3. Rs. 800 @ 10%, Rs. 400 @ 12%
  4. Rs. 700 @ 10%, Rs. 500 @ 12%

10. A person borrowed Rs. 7,500 at 16% compound interest. How much does he have to pay at the end of two years to clear the loan?  

  1. Rs. 9,900
  2. Rs. 10,092
  3. Rs. 11,000
  4. Rs. 11,052

11. If the rate of interest is 10% per annum and is compounded half yearly, the principal of Rs. 400 in 3/2 years will amount to  

  1. Rs. 463.00
  2. Rs. 463.05
  3. Rs. 463.15
  4. Rs. 463.20

12. The compound interest on a sum for 2 years is Rs. 882 and the simple interest on the same sum at the same rate for the same period is Rs. 800. What is the rate of interest?  

  1. 6 %
  2. 8 %
  3. 10 %
  4. 12 %

13. A person invested part of Rs. 45000 at 4% and the rest at 6%. If his annual income from both are equal, then what is the average cost of interest?  

  1. 4.6 %
  2. 4.8 %
  3. 5.0 %
  4. 5.2 %

14. At what rate % per annum simple interest, will a sum of money triple itself in 25 years?  

  1. 8 %
  2. 9 %
  3. 10 %
  4. 12 %


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