The effective annual rate of interest for 10% per annum compounded quarterly is: MCQ with Answer and Explanation

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The effective annual rate of interest for 10% per annum compounded quarterly is:

A. 10.25%

B. 10.50%

C. 10.47%

D. 10.38%

Answer: Option D

Solution (By JKSSB Mock Tests)

Quarterly rate 2.5%, (1.025)⁴ = 1.10381289, effective = 10.3813% ≈ 10.38%.

This question belongs to: Maths Compound Interest

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Practice More Compound Interest Questions

Question #1

The compound interest on Rs. 3500 at 8% per annum for 2 years is:

A. Rs. 592.00

B. Rs. 588.00

C. Rs. 576.40

D. Rs. 582.40

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Correct Answer: Option D

Explanation:
A = 3500 × (1.08)² = 3500 × 1.1664 = 4082.40, CI = 4082.40 − 3500 = Rs. 582.40.

This question belongs to: Maths Compound Interest

Question #2

What will be the compound interest on Rs. 7500 at 4% per annum for 2 years?

A. Rs. 608

B. Rs. 616

C. Rs. 624

D. Rs. 612

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Correct Answer: Option D

Explanation:
A = 7500 × (1.04)² = 7500 × 1.0816 = 8112, CI = 8112 − 7500 = Rs. 612.

This question belongs to: Maths Compound Interest

Question #3

The compound interest on a certain sum of money for 2 years at 8% per annum is Rs. 832. What would be the simple interest on the same sum at the same rate for the same time?

A. Rs. 820

B. Rs. 780

C. Rs. 810

D. Rs. 800

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Correct Answer: Option D

Explanation:
Effective rate of compound interest for 2 years at 8% = 8 + 8 + (88)/100 = 16.64%. Simple interest rate = 8 * 2 = 16%. Given 16.64% of sum = 832 => 1% of sum = 50. Simple Interest = 16% of sum = 16 * 50 = Rs. 800.

This question belongs to: Maths Compound Interest

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