02/06/2016

CompoundInterestSolvedExamplesSet1
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Home> Quantitativeaptitudequestionsandanswerswithexplanation > CompoundInterest>SolvedExamplesSet1

1. ImportantFormulas

1. What is the difference between the compound interests on Rs. 5000 for 112 years

2. MoreFormulas

at4%perannumcompoundedyearlyandhalfyearly?

3. SolvedExamplesSet1

A.Rs.2.04

B.Rs.4.80

C.Rs.3.06

D.Rs.8.30

4. SolvedExamplesSet2
5. SolvedExamplesSet3
6. SolvedExamplesSet4

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7. SolvedExamplesSet5

Hereistheanswerandexplanation

8. SolvedExamplesSet6

Answer:OptionA

9. SolvedExamplesSet7
10. SolvedExamplesSet8
11. SolvedExamplesSet9

Explanation:
Amountafter112yearswheninterestiscompoundedyearly

12. SolvedExamplesSet
10

)
100

4
= 5000 (1 +

1 +

= 5000

100

104

2
(1 +

100

)
100

102

= 5000

104

51
= 50 104

100

100

50

= 104 51 = Rs.5304

CompoundInterestfor1 12yearswheninterestiscompoundedyearly
=Rs.(53045000)
Amountafter112yearswheninterestiscompoundedhalfyearly
2T

(R/2)
= P(1 +

(4/2)
= 5000(1 +

100

3
2

102
= 5000 (

100
51
= 102 51

102
)(

100

)
100

102
)(

100

2
= 5000(1 +

100
3

102
= 5000(

51
) = 50 102

51

100

50

50

51
= 51 51

50

= Rs.5306.04
25

CompoundInterestfor1 12yearswheninterestiscompoundedhalfyearly
=Rs.(5306.045000)
Differenceinthecompoundinterests=(5306.045000)(53045000)=5306.04
5304=Rs.2.04

2. A bank offers 5% compound interest calculated on halfyearly basis. A customer

depositsRs.1600eachon1stJanuaryand1stJulyofayear.Attheendoftheyear,
theamounthewouldhavegainedbywayofinterestis:
A.Rs.120

B.Rs.121

C.Rs.123

D.Rs.122

HideAnswer | Notebook |Discuss

Hereistheanswerandexplanation
Answer:OptionB
Explanation:
Amount after 1 year on Rs. 1600 (deposited on 1st Jan) at 5% when interest
calculatedhalfyearly
2T

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2T

(R/2)
= P(1 +

21

(5/2)
= 1600(1 +

100

= 1600(1 +

100

40

Amount after 1/2 year on Rs. 1600 (deposited on 1st Jul) at 5% when interest
calculatedhalfyearly
2T

(R/2)
= P(1 +

(5/2)
= 1600(1 +

1
2

100

1
= 1600 (1 +

100

)
40

TotalAmountafter1year
2

1
= 1600(1 +

40

) = 1600(
40

41
= 1600 (

41

+ 1600 (1 +

41
+ 1600 (

40

41
) = 1600 (

40

41
) [1 +

40

]
40

81
)(

40

) = 41 81 = Rs.3321
40

CompoundInterest=Rs.3321Rs.3200=Rs.121

3.Thereis80%increaseinanamountin8yearsatsimpleinterest.Whatwillbethe
compoundinterestofRs.14,000after3yearsatthesamerate?
A.Rs.3794

B.Rs.3714

C.Rs.4612

D.Rs.4634

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Hereistheanswerandexplanation
Answer:OptionD
Explanation:
LetP=Rs.100
SimpleInterest=Rs.80

(80%increaseisduetothesimpleinterest)

100 SI
Rate of interest =

100 80
=

= 10%per annum

PT

100 8

Nowlet'sfindoutthecompoundinterestofRs.14,000after3yearsat10%
P=Rs.14000
T=3years
R=10%
R
Amount after 3 years = P(1 +

)
100

110
= 14000(

11
= 14000(

100

10
= 14000(1 +

)
100

= 14 11

= 18634

10

CompoundInterest=Rs.18634Rs.14000=Rs.4634

4.ThecompoundinterestonRs.30,000at7%perannumisRs.4347.Theperiod(in
years)is:
A.1

B.2

C.3

D.3.5

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Hereistheanswerandexplanation
Answer:OptionB
Explanation:
Lettheperiodbenyears
Then,amountafternyears=Rs.(30000+4347)=Rs.34347

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CompoundInterestSolvedExamplesSet1
T

R
P(1 +

= 34347

100

7
30000(1 +

= 34347

100

107
30000(

= 34347

100

107
(

34347

11449

100

30000

107
= (

=
10000

)
100

n = 2years

5. The difference between simple and compound interests compounded annually on a

certainsumofmoneyfor2yearsat4%perannumisRe.1.Thesumis:
A.Rs.600

B.Rs.645

C.Rs.525

D.Rs.625

HideAnswer | Notebook |Discuss

Hereistheanswerandexplanation
Answer:OptionD
Explanation:

Solution1

LetthesumbeRs.x
Amount after 2 years on Rs.x at 4% per annum when interest is compounded annually

4
= x(1 +

104
= x(

100

)
100

104
Compound Interest =x(

100

104
= x [(

26
1] = x [(

100

676
1] = x [

25

PRT
Simple Interest =

x 4 2
=

100

51
1] = x [

625

51x
] =

625

625

2x
=

100

25

GiventhatdifferencebetweencompoundinterestandsimpleinterestisRs.1
51x

2x

625

= 1
25

51x 50x

= 1
625

x = 625

Solution2

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ThedifferencebetweencompoundinterestandsimpleinterestonRs.Pfor2years
atR%perannum
R

= P(
100

[Readmore...]

R
P(

= 1

100

4
P(

= 1

100

1
P(

= 1

25

1
P(

) = 1
625

P = 625

i.e.,requiredsumisRs.625

1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10

Comments(3) SortNewest
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showing13of3comments,sortednewesttotheoldest
aashishgupta 1yearago
sir,canwehavesamplequestionofothersectionslogicalreasoning,dATA
INTERPRETATION.
(0)

(0) Reply

sreejothi 1yearago
thedifferencebetweentheS.IandC.Icompoundedeverysixmonthsatrateof30%per
annum,attheendof11/2yearsofrs.5670.whatisthesum?(rs.40,000,Rs.60,000,
Rs.64,000,Rs.72,000,Rs.80,000)
(0)

(0) Reply

(0)

(0) Reply

Dev 1yearago
Time=11/2year=3/2year
R=30
LetPistheamount
SimpleInterest=PRT/100=P*30*(3/2)/100=9P/20
CompoundInterest=P[1+(R/2)/100]2nP
=P[1+(30/2)/100](2*3/2)P
=P(1.15)3P
=P[(1.15)31]
P[(1.15)31]9P/20=5670
P[(1.15)319/20]=5670
P=80000

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