The effective annual rate of interest for 8% per annum compounded quarterly is: MCQ with Answer and Explanation

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The effective annual rate of interest for 8% per annum compounded quarterly is:

A. 8.30%

B. 8.24%

C. 8.42%

D. 8.16%

Answer: Option B

Solution (By JKSSB Mock Tests)

Quarterly rate 2%, (1.02)⁴ = 1.08243216, effective = 8.2432% ≈ 8.24%.

This question belongs to: Maths Compound Interest

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Question #1

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A man invested Rs. 15000 at compound interest for 2 years at 4% per annum. Find the amount.

A. Rs. 16300

B. Rs. 16240

C. Rs. 16224

D. Rs. 16400

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Correct Answer: Option C

Explanation:
A = 15000 × (1.04)² = 15000 × 1.0816 = 16224.

This question belongs to: Maths Compound Interest

Question #2

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In how many years will Rs. 1200 amount to Rs. 1323 at 5% per annum compound interest?

A. 3 years

B. 1.5 years

C. 2.5 years

D. 2 years

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Correct Answer: Option D

Explanation:
1200(1.05)^t = 1323 ⇒ (1.05)^t = 1.1025 = (1.05)² ⇒ t = 2.

This question belongs to: Maths Compound Interest

Question #3

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

A. 10 years

B. 20 years

C. 16 years

D. 12 years

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Correct Answer: Option D

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

This question belongs to: Maths Compound Interest

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