The difference between simple interest and compound interest on Rs. 18000 for 2 years is Rs. 405. Find the rate of interest per annum. MCQ with Answer and Explanation

Question

The difference between simple interest and compound interest on Rs. 18000 for 2 years is Rs. 405. Find the rate of interest per annum.

A. 12%

B. 18%

C. 20%

D. 15%

Answer: Option D

Solution (By JKSSB Mock Tests)

Difference for 2 years = P * (R/100)^2 => 405 = 18000 * (R/100)^2 => 405 = 1.8 * R^2 => R^2 = 405 / 1.8 = 225 => R = 15%.

This question belongs to: Maths Compound Interest

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Question #1

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The simple interest on a sum for 2 years at 4% is Rs. 200. The compound interest on the same sum for 2 years at 4% is:

A. Rs. 206

B. Rs. 200

C. Rs. 202

D. Rs. 204

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Correct Answer: Option D

Explanation:
P = 20000/(4×2) = 2500. CI = 2500 × [(1.04)² − 1] = 2500 × 0.0816 = 204.

This question belongs to: Maths Compound Interest

Question #2

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The compound interest on a certain sum for 2 years at 10% per annum is Rs. 840. Find the principal sum.

A. Rs. 3800

B. Rs. 4200

C. Rs. 4000

D. Rs. 4400

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Correct Answer: Option C

Explanation:
Effective rate of compound interest for 2 years at 10% = 10 + 10 + (1010)/100 = 21%. Given 21% of P = 840 => P = 840 / 0.21 = Rs. 4000.

This question belongs to: Maths Compound Interest

Question #3

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In how many years will Rs. 3500 amount to Rs. 4235 at 10% per annum compound interest?

A. 2 years

B. 1 year

C. 2.5 years

D. 1.5 years

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Correct Answer: Option A

Explanation:
3500(1.1)^t = 4235 ⇒ (1.1)^t = 1.21 ⇒ t = 2.

This question belongs to: Maths Compound Interest

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