The effective annual rate for 11% per annum compounded half-yearly is: MCQ with Answer and Explanation

Question

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The effective annual rate for 11% per annum compounded half-yearly is:

A. 11.50%

B. 11.30%

C. 11.35%

D. 11.25%

Answer: Option B

Solution (By JKSSB Mock Tests)

Half-yearly rate 5.5%, (1.055)² = 1.113025, effective = 11.3025% ≈ 11.30%.

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 becomes double of itself in 4 years. In how many years will it become 8 times of itself?

A. 20 years

B. 8 years

C. 16 years

D. 12 years

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Correct Answer: Option D

Explanation:
The sum becomes 2^1 times in 4 years. It will become 8 (2^3) times in 3 * 4 = 12 years.

This question belongs to: Maths Compound Interest

Question #2

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The compound interest on a sum for 2 years at 10% compounded half-yearly is Rs. 215.50. The sum is:

A. Rs. 950

B. Rs. 1000

C. Rs. 1050

D. Rs. 900

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Correct Answer: Option B

Explanation:
Half-yearly rate 5%, n=4. CI = P[(1.05)⁴ − 1] = P × 0.21550625 = 215.50 ⇒ P = 215.50 / 0.21550625 = 1000.

This question belongs to: Maths Compound Interest

Question #3

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The compound interest on Rs. 4000 at 10% per annum for 2 years compounded half-yearly is:

A. Rs. 861

B. Rs. 820

C. Rs. 800

D. Rs. 840

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Correct Answer: Option A

Explanation:
Half-yearly rate = 5%, n = 4. A = 4000 × (1.05)⁴ = 4000 × 1.21550625 = 4862.025, CI = 862.025 ≈ Rs. 861.

This question belongs to: Maths Compound Interest

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