Maths - Compound Interest

• Amount = Principal + Interest
• Simple Interest = (Principal x Rate x Time)/100
• A = P Here A = amount, P = principal, r = rate percent yearly (or every fixed period) and n is the number of years (or terms of the fixed period).
• C.I. = P , where C.I. = compound interest
• S.I. (simple interest) and C.I. (compound interest) are equal for the first year (or the first term of the fixed period) on the same sum and at the same rate.
• C.I. of 2nd year (or the second term of the fixed period) is more than the C.I. of 1st year or the first term of the fixed period), and C.I. of 2nd Year -C.I. of 1st year = S.I. on the interest of the first year.

                                                    Exercise

1. Albert invested an amount of Rs. 8000 in afixed deposit scheme for 2 years at compound interest rate 5% pa. How much amount will Albert get on maturity of the fixed deposit?

      a. 8600 b. 8620 c. 8800 d. 8840 e. None

2. What will be the compound interest on a sum of Rs. 25000 after 3 years at the rate of 12 % pa?

     a. 9000.30 b. 9720 c. 10123.20 d. 10483.20 e. None

3. Sam invested Rs. 15000 at the rate of 10% pa for one year. If the interest is compouned half yearly, than the amonut received by Sam at the end of one year will be:

     a. 16500 b. 16525.50 c. 16537.50 d. 18150 e. None

4. Find the compoune interest on Rs. 15625 for 9 months at 16% per annum compounded quarterly.

     a. 1851 b. 1941 c. 1951 d. 1961

5. If the simple interest on asum of money for 2 years at 5% pa is Rs. 50, what is the Compound interest on the same sum at the same rate and for the same period?

     a. 51.25 b. 52 c. 54.25 d. 60

6. The difference between simple interest and compound interest on Rs 1200 for one year at the rate of 10% per annum reckoned half yearly is Rs. Is:

     a. 2.50 b. 3 c. 3.75 d. 4 e. None

7. The present worth of Rs. 169 due in 2 years at 4% pa componud interest is:

     a. 150.50 b. 154.75 c. 156.25 d. 158

8. The compound interest on a certain sum for 2 years at 10% pa is Rs. 525. The simple interest on the same sum for double the time at half the rate percent per annum is:

    a. 400 b. 500 c. 600 d.800

9. The difference between compound interest and simple interest on an amount of Rs. 15000 for 2 years is Rs. 96. What is the rate of interest per annum?

    a. 8 b. 10 c. 12 d. Can't find e. None

10. The effective annual rate of interest corrosponding to a nominal rate of 6% pa payable half yealy is;

    a. 6.06 % b. 6.07% c. 6.08% d. 6.09%
Ans: 1e, 2c, 3c, 4c, 5a, 6b, 7c, 8b, 9a, 10d, 11c