Question 1

When $720 is invested for 36 months it earns $205.20 simple interest. Find the yearly interest rate.

Accepted Answer

r = (100 x I)/(P x T)

Question 2

A loan of $15 000 is taken out. If the interest rate on the loan is 7%, how much interest is due and what is the amount repaid if the loan is due in seven months

Accepted Answer

We have P = 15 000, r = 0.07 and since the actual date the loan was taken out is not given, we use t =7/12 I = Prt=$15 000* 0.07* 7/12 = $612.50 Amount repaid = Future or accumulated value, S = P + I = $15 000 + $612.50 = $15 612.50

Question 3

A loan shark made a loan of $100 to be repaid with $120 at the end of one month. What was the annual interest rate?

Accepted Answer

r=I/PT

Question 4

What is the SI on Rs.7500/- at the rate of 10% per annum for 5 years?

Accepted Answer

S.I=PNR/100

Question 5

What will be the ratio of simple interest earned by certain amount at the same rate of interestfor 4 years and 6 years ?

Accepted Answer

Let p be the principle amount And R% be the rate of interest Then, required ratio = P × 4 × R 100 P × 6 × R 100 ⇒ 4 P R 6 P R = 2:3

Question 6

If rupee two produces rupees eleven over a period of 30 years, find the rate of simple interest ?

Accepted Answer

We know that I = PTR/100 11 = (2x30xR)/100 R = 18.333 %

Question 7

A certain sum is invested at simple interest at 18% p.a. for two years instead of investing at 12% p.a. for the same time period. Therefore the interest received is more by Rs. 840. Find the sum ?

Accepted Answer

Let the sum be Rs. S. (S x 18 x 2)/100 - (S x 12 x 2)/100 = 840 => 36S/100 - 24S/100 = 840 => 12S/100 = 840 => S = 7000.

Question 8

An automobile financier claims to be lending money at S.I., but he includes the interest every six months for calculating the principal. If he is charging an interest of 8%, the effective rate of interest becomes ?

Accepted Answer

Let the sum be Rs. 100. Then, S.I. for first 6 months = (100 x 8 x 1) / (100 x 2) = Rs. 4 S.I. for last 6 months = (104 x 8 x 1) / (100 x 2) = Rs. 4.16 So, amount at the end of 1 year = (100 + 4 + 4.16) = Rs. 108.16 Effective rate = (108.16 - 100) = 8.16%.

Question 9

A sum of money at simple interest amounts to Rs. 415 in 2 years and to Rs. 514 in 4 years. The sum is ?

Accepted Answer

S.I. for 2 years = (514 - 415) = Rs. 99 S.I. for 1 year = 99/2 Principal = (415 - 99) = Rs. 316.

Question 10

Avinash gave a sum of 5400 at the simple rate of interest of 8% to Rajeev for 4 years and Rajeev gave this amount to Chanukya at the rate of 6% for 4 years. Find how much extra amount has to be paid by Rajeev to Avinash after 4 years?

Accepted Answer

Here Avinash gave to Rajeev and Rajeev gave the same to Chanukya Principal amount and Time is same but the only difference is Rate of interest. Rajeev took @ 8% and gave it to Chanukya @ 6% Here the difference in interest rate = 2% 2% of 5400 should be the extra amount paid by Rajeev to Avinash Required amount = 2 x 5400 x 4 100 = 432 Hence, Rs. 432 is the extra amount has to be paid by Rajeev to Avinash after 4 years.

Question 11

The simple interest on Rs.10 for 4 months at the rate of 3 paise per month is

Accepted Answer

Given Principal amount P = Rs. 10 Time T = 4 months Rate of interest R = 3 ps Interest I = PTR/100 = (10 x 4 x 3)/100 = 12/10 = 1.2 paise.

Question 12

A sum of Rs. 10,000 is lent partly at 6% and the remaining at 10% p.a. If the yearly interest on the average is 9.2%, the money lent at 10% is:-

Accepted Answer

Let the amount at 6% be x Amount at 10% be (10000 –x) At 9.2 % interest, SI = 10000 X 9.2 X 1/100 = 920 Amount = 10920 ⇒ 6x/100 + (10000 – x)10/100 = 920 ⇒ 6x – 10x + 100000 = 92000 ⇒ 4x = 8000 ⇒ x = 2000 Money lent at 10 % = 10000 – 2000 = 8000

Simple Interest Questions