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Compound Interest - Aptitude Questions and Answers - RejinpaulPlacement




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1.
Find the compound interest on Rs. 7500 at 4% per annum for 2 years , compounded annually.
Answer & Solution
Answer: b) Rs. 612

Solution:   Amount = Rs. [7500 * (1 + (4/100))^2]
= Rs. [7500 * (26/25) * (26/25)] = Rs. 8112.

C.I. = Rs. (8112 - 7500) = Rs. 612.
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2.
Find compound interest on Rs. 8000 at 15% per annum for 2 years 4 months, compounded annually.
Answer & Solution
Answer: d) Rs. 3109

Solution:   Time = 2 years 4 months = 2 4/12 years = 2 1/3 years.

Amount = Rs. [8000 * [1 + (15/100)]^2 * [1 + ((1/3 * 15)/100)]]
= Rs. [8000 * (23/20) * (23/20) * (21/20)]
= Rs. 11109.

C.I. = Rs. (11109 - 8000) = Rs. 3109
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3.
Find the compound interest on Rs. 10,000 in 2 years at 4% per annum, the interest being compounded half-yearly. [S.S.C. 2000]
Answer & Solution
Answer: c) 824.32

Solution:   Principal = Rs. 10000, Rate = 2% per half year, Time = 2 years = 4 half years

Amount = Rs. [10000 * [1 + (2/100)]^4]
= Rs. [10000 * (51/50) * (51/50) * (51/50) * (51/50)]
= Rs. 10824.32.

C.I. = Rs. (10824.32 - 10000) = Rs. 824.32
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4.
Find the compound interest on Rs. 16,000 at 20% per annum for 9 months, compounded quarterly.
Answer & Solution
Answer: b) Rs. 2522

Solution:   Principal = Rs. 16000; Time = 9 months = 3 quarters; Rate = 20% per annum = 5% per quarter.

Amount = Rs. [16000 * [1 * (5/100)]^3]
= Rs. [16000 * (21/20) * (21/20) * (21/20)]
= Rs. 18522

C.I. = Rs. (18522 - 16000) = Rs. 2522
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5.
If the simple interest on a sum of money at 5% per annum for 3 years is Rs. 1200, find the compound interest on the same period at the same rate.
Answer & Solution
Answer: c) Rs. 1261

Solution:   Clearly, rate = 5% p.a.; Time = 3 years; S.I. = Rs. 1200

So, Principal = Rs. [(100 * 1200)/(3 * 5)] = Rs. 8000

Amount = Rs. [8000 * [1 + (5/100)]^3]
= Rs. [8000 * (21/20) * (21/20) * 21/20)] = Rs. 9261

C.I. = Rs. (9261 - 8000) = Rs. 1261
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6.
In what time will Rs. 1000 become Rs. 1331 at 10% per annum compounded annually? [S.S.C. 2004]
Answer & Solution
Answer: b) 3 years

Solution:   Principal = Rs. 1000; Amount = Rs. 1331; Rate = 10% p.a.

Let the time be n years. Then
[1000 [1 + (10/100)]^n ] = 1331
(11/10)^n = (1331/1000) = (11/10)^3

n = 3 years.
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7.
If Rs. 500 amounts to Rs. 583.20 in two years compounded annually, find the rate of interest per annum.
Answer & Solution
Answer: d) 8%

Solution:   Principal = Rs. 500; Amount = Rs. 583.20 ; Time = 2 years.

Let the rate be R% per annum. Then,

[500 [1 + (R/100)^2 ] = 583.20
=> [1 + (R/100)]^2 = 5832/5000 = 11664/10000

[1 + (R/100)]^2 = (108/100)^2
[1 + (R/100)] = 108/100
=> R = 8

So, rate = 8% p.a.
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