Simple and Compound Interest MCQs with Answers

Akbar borrowed Rs. 70,000 from a bank at 7% interest for 3 years. The amount of markup is:

• A.Rs. 14,000
• B.Rs. 12,600
• C.Rs. 16,800
• D.Rs. 14,700

If a sum on compound interest becomes 3 times in a certain number of years, then with the same interest rate, in how many years will it become 27 times?

• A.6 years
• B.9 years
• C.12 years
• D.15 years

Past Paper MCQ

Kyle bought a $\$2000$ government bond that yields $6\%$ simple interest per year. Write the equation that gives the total amount $A$, in dollars, Kyle will receive when he sells the bond after $t$ years.

• A.$A = 2000(0.06)^t$
• B.$A = 2000(1 + 0.06)^t$
• C.$A = 2000 + 0.06t$
• D.$A = 2000(1 + 0.06t)$

What is the least number of complete years in which a sum of money, invested at 20% compound interest annually, will more than double?

• A.3 years
• B.4 years
• C.5 years
• D.6 years

What is the basic formula for simple interest?

• A.Principal × Rate × Time
• B.Principal × (1 + Rate)^Time
• C.Principal × Rate × Time ÷ 100
• D.Principal ÷ (Rate × Time)

A man borrows Rs. 2550 to be paid back with compound interest at 4% per annum in 2 equal yearly installments. What is the value of each installment?

• A.Rs. 1300
• B.Rs. 1275
• C.Rs. 1352
• D.Rs. 1404

The markup on Rs. 8000 for 5 years at the rate of 7% per annum is ?

• A.Rs. 2800
• B.Rs. 5600
• C.Rs. 1400
• D.Rs. 3500

If the interest on an amount of Rs 5000 is Rs 1500 in 3 years, what is the rate of interest?

• A.$5\%$
• B.$10\%$
• C.$15\%$
• D.$20\%$

An amount of Rs. 5000 is invested at a fixed rate of 8% per annum. What will be the value of the investment in five years' time, if the interest is compounded every six months?

• A.Rs. 7321.85
• B.Rs. 7346.64
• C.Rs. 7459.12
• D.Rs. 7401.22

What annual payment will discharge a debt of Rs. 1025 due in 2 years at a compound interest rate of 5% per annum?

• A.Rs. 551.25
• B.Rs. 560.00
• C.Rs. 540.50
• D.Rs. 575.75