Hello Aspirants. Welcome to Online Maths in AffairsCloud.com. Here we are creating question sample in **Compound Interest**, which is common for all the IBPS, SBI exam and other competitive exams. We have included Some questions that are repeatedly asked in exams !!

**On a certain sum of money, after 2 years the simple interest and compound interest obtained are Rs 800 and Rs 960 respectively. What is the sum of money invested?**

A) Rs 1420

B) Rs 1325

C) Rs 1000

D) Rs 1405

E) Rs 1375

###### Answer & Explanation

**C) Rs 1000**

Explanation:

Diff = 960-800 = 160

r = 2*Diff*100/SI

So r = 2*160*100/800 = 40%

Now 160 = Pr^{2}/100^{2}

**Rs 6000 becomes Rs 7200 in 3 years at a certain rate of compound interest. What will be the amount received after 9 years?**

B) Rs 10,352

C) Rs 9,368

D) Rs 10,368

E) None of these

###### Answer & Explanation

**D) Rs 10,368**

**Explanation:**

6000[1 + r/100]^{3}= 7200

So [1 + r/100]^{3}= 6/5

So 6000[1 + r/100]^{9}= 6000*(6/5)*(6/5)*(6/5)**A man borrows Rs 4000 at 8% compound interest for 3 years. At the end of each year he paid Rs 500. How much amount should he pay at the end of 3rd year to clear the debt?**

A) Rs 4254.5

B) Rs 3465.2

C) Rs 3485.2

D) Rs 4345.4

E) Rs 3915.6

###### Answer & Explanation

**E) Rs 3915.6**

Explanation:

Amount after 1 yr = 4000[1 + 8/100] = 4320

Paid 500, so P = 4320 – 500 = 3820

Amount after 2nd yr = 3820[1 + 8/100] = 4125.6

So P= 4125.6-500 = 3625.6

Amount after 3rd yr = 3625.6[1 + 8/100] = 3915.6

**A sum of money is lent for 2 years at 20% p.a. compound interest. It yields Rs 482 more when compounded semi-annually than compounded annually. What is the sum lent?**

A) Rs 25,600

B) Rs 20,000

C) Rs 26,040

D) Rs 40,500

E) None of these

###### Answer & Explanation

**B) Rs 20,000**

Explanation:

P[1 + (r/2)/100]^{4}– P[1 + r/100]^{2}= 482

P[1 + 10/100]^{4}– P[1 + 20/100]^{2}= 482

Solve, P = 20,000**The compound interest obtained after 1st and 2nd year is Rs 160 and Rs 172.8 respectively on a certain sum of money invested for 2 years. What is the rate of interest?**

A) 10%

B) 8%

C) 8.5%

D) 9%

E) 9.2%

###### Answer & Explanation

**B) 8%**

Explanation:

Difference in interest for both yrs = 172.8 – 160 = 12.8

So (r/100)*160 = 12.8

**A sum of money becomes Rs 35,280 after 2 years and Rs 37,044 after 3 years when lent on compound interest. Find the principal amount.**

A) Rs 32,000

B) Rs 28,000

C) Rs 31,500

D) Rs 32,500

E) None of these

###### Answer & Explanation

**A) Rs 32,000**

Explanation:

P[1 + r/100]^{3}= 37,044, and P[1 + r/100]^{2}= 35,280

Divide both equations, [1 + r/100] = 37044/35280 = 21/20

So P[21/20]^{2}= 35280**The difference between compound interest earned after 3 years at 5% p.a. and simple interest earned after 4 years at 4% p.a. is Rs 76. Find the principal amount.**

A) Rs 32,000

B) Rs 28,000

C) Rs 31,500

D) Rs 32,500

E) None of these

###### Answer & Explanation

**A) Rs 32,000**

Explanation:

[P[1 + 5/100]^{3}– P] – P*4*4/100 = 76

P [9261/8000 – 1 – 16/100] = 76**A sum of money is lent at simple interest and compound interest. The ratio between the difference of compound interest and simple interest of 3 years and 2 years is 35 : 11. What is the rate of interest per annum?**

A) 20 3/4%

B) 17 2/5%

C) 18 2/11%

D) 22 1/5%

E) 24 5/6%

###### Answer & Explanation

**C) 18 2/11%**

Explanation:

Difference in 3 yrs = Pr^{2}(300+r)/100^{3}

Difference in 2 yrs = Pr^{2}/100^{2}

So Pr^{2}(300+r)/100^{3}/ Pr^{2}/100^{2}= 35/11 (300+r)/100 = 35/11**A sum of money borrowed at 5% compound interest is to paid in two annual installments of Rs 882 each. What is the sum borrowed?**

A) Rs 1650

B) Rs 2340

C) Rs 2630

D) Rs 1640

E) Rs 2640

###### Answer & Explanation

**D) Rs 1640**

Explanation:

P = 882/[1 + 5/100] + 882/[1 + 5/100]^{2}**Rs 3903 is to be divided in a way that A’s share at the end of 7 years is equal to the B’s share at the end of 9 years. If the rate of interest is 4% compounded annually, find A’s share.**

A) Rs 2475

B) Rs 1875

C) Rs 2175

D) Rs 1935

E) Rs 2028

###### Answer & Explanation

**B) Rs 1875**

Explanation:

A’s share = (1 + 4/100)^{7}

B’s share = (1 + 4/100)^{9}

Divide both, B/A = (1 + 4/100)^{2}= 676/625

So A’s share = 625/(676+625) * 3903

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