The difference between compound interest and simple interest on Rs. 12500 for 2 years is Rs. 20. Find the rate of interest per annum. MCQ with Answer and Explanation

Question

The difference between compound interest and simple interest on Rs. 12500 for 2 years is Rs. 20. Find the rate of interest per annum.

A. 3%

B. 4%

C. 6%

D. 5%

Answer: Option B

Solution (By JKSSB Mock Tests)

Difference for 2 years = P * (R/100)^2 => 20 = 12500 * (R/100)^2 => 20 = 12500 * R^2 / 10000 => 20 = 1.25 * R^2 => R^2 = 20 / 1.25 = 16 => R = 4%.

This question belongs to: Maths Compound Interest

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Question #1

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A sum of money placed at compound interest doubles itself in 4 years. In how many years will it amount to 8 times itself?

A. 16 years

B. 12 years

C. 10 years

D. 8 years

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Correct Answer: Option B

Explanation:
2 times in 4 years, 8 = 2³ ⇒ 4 × 3 = 12 years.

This question belongs to: Maths Compound Interest

Question #2

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The compound interest on Rs. 20000 at 8% per annum for 1 year compounded half-yearly is:

A. Rs. 1600

B. Rs. 1664

C. Rs. 1680

D. Rs. 1632

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Correct Answer: Option D

Explanation:
Half-yearly rate 4%, n=2. A = 20000 × (1.04)² = 20000 × 1.0816 = 21632, CI = 21632 − 20000 = Rs. 1632.

This question belongs to: Maths Compound Interest

Question #3

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A sum of money at compound interest becomes 9 times in 2 years. In how many years will it become 81 times?

A. 5 years

B. 4 years

C. 6 years

D. 3 years

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Correct Answer: Option B

Explanation:
81 = 9², so 2 × 2 = 4 years.

This question belongs to: Maths Compound Interest

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