Students can find several questions on Compound Interest. Practice the Objective Questions of Compound Interest Over here and be prepared for the exams. Learn how to solve Compound Interest Problems by checking the Solved Examples. Use the Sample Problems over here covering various questions including the Compound Interest Formula.
Compound Interest Practice Test has questions when the Interest Rate is Compounded Annually, Half-Yearly, Quarterly, Various Rate of Interest, Amount Calculations, etc. Solve the Questions on CI and test your knowledge on the related areas and bridge the gap accordingly.
1. The compound interest on $ 20,000 at 5 % per annum for 3 years, compounded annually is?
Solution:
P = $20,000
R = 5%
n = 3 Years
A = P(1+R/100)n
= 20,000(1+5/100)3
=20,000(105/100)3
= 20,000(1.157)
= $23152
CI = A – P
= $23152 – $20,000
= $3152
2. The simple interest on a sum of money for 2 years at 3 % per annum is $ 6250. What will be the compound interest on the same sum at the same rate for the same period, compounded annually?
Solution:
From given data SI = $6250
T = 2 Years
R = 3%
SI = PTR/100
6250 = P*2*3/100
6250 = 6P/100
6250*100 = 6P
6P = 625000
P = $1,04,166
We know A = P(1+R/100)n
=1,04,166(1+3/100)2
=1,04,166(103/100)2
=1,10,509
Compound Interest = Amount – Principal
= $1,10,509 – $1,04,166
= $6343
3. If a sum of Rs. 10,000 lent for 10% per annum at compound interest then the sum of the amount will be Rs. 14,161 in
Solution:
We know A = P(1+R/100)n
Given P = Rs. 10,000
R = 10%
A = 14,161
n = ?
Substitute the input values in the formula of Amount we have
14161 = 10000(1+10/100)n
14161/10000 = (1+10/100)n
(11/10)4 = (11/10)n
n = 4 Years
4. The population of a city is 1,20,000. It increases by 5% in the first year and increases by 10% in the second year. What is the population of the town at the end of 2 yrs?
Solution:
The population of city = 1,20,000
The population of city after 2 years = P(1+R1/100)(1+R2/100)
= 1,20,000(1+5/100)(1+10/100)
= 1,20,000(1.05)(1.1)
= 1,38,600
Therefore, the Population of the city by the end of 2 years is 1,38,600.
5. The difference between simple interest and compound on Rs. 1500 for one year at 20% per annum reckoned half-yearly is
Solution:
Given Data is Principal = 1500
R = 20%
T = 1 year
SI = PTR/100
= (1500*1*20)/100
= Rs. 300
Amount A = P(1+R/100)n
=1500(1+(10/100))2
= 1500(1+1/10)2
=1500(1.1)2
= Rs. 1815
CI = A – P
= Rs. 1815 – Rs. 1500
= Rs. 315
Difference = CI – SI
= Rs. (315 – 300)
= Rs. 15