Question Detail

A financier claims to be lending money at simple interest, But he includes the interest every six months for calculating the principal. If he is charging an interest of 10%, the effective rate of interest becomes.

10.25%
10%
9.25%
9%

Answer: Option A

Explanation:

Let the sum is 100.

As financier includes interest every six months., then we will calculate SI for 6 months, then again for six months as below:

SI for first Six Months = (100*10*1)/(100*2) = Rs. 5

Important: now sum will become 100+5 = 105

SI for last Six Months = (105*10*1)/(100*2) = Rs. 5.25

So amount at the end of year will be (100+5+5.25)
= 110.25

Effective rate = 110.25 - 100 = 10.25

1. A sum of Rs 12,500 amounts to Rs. 15,500 in the 4 years at the rate of simple interest. Find the rate percent

Answer: Option A

Explanation:

\begin{aligned}
\text{S.I.} = \frac{P*R*T}{100} \\
=> R = \frac{S.I. * 100}{P*T}
\end{aligned}

So, S.I = 15500 - 12500 = 3000.

\begin{aligned}
=> R = \frac{3000 * 100}{12500*4} = 6\%
\end{aligned}

2. At what rate percent per annum will the simple interest on a sum of money be 2/5 of the amount in 10 years

Answer: Option D

Explanation:

Let sum = x
Time = 10 years.
S.I = 2x /5, [as per question]
Rate =( (100 * 2x) / (x*5*10))%
=> Rate = 4%

3. A sum of money at simple interest amounts to Rs. 2240 in 2 years and to Rs. 2600 in 5 years. What is the principal amount

1000
1500
2000
2500

Answer: Option C

Explanation:

SI for 3 year = 2600-2240 = 360
SI for 2 year 360/3 * 2 = 240
principal = 2240 - 240 = 2000

4. A man took a loan at rate of 12% per annum simple interest. After 3 years he had to pay 5400 interest. The principal amount borrowed by him was.

Rs 14000
Rs 15000
Rs 16000
Rs 17000

Answer: Option B

Explanation:

\begin{aligned}
\text{S.I.} = \frac{P*R*T}{100} \\
=> P = \frac{S.I. * 100}{R*T} \\
=> P = \frac{5400 * 100}{12*3} = Rs 15000
\end{aligned}

5. Rs. 800 becomes Rs. 956 in 3 years at a certain rate of simple interest. If the rate of interest is increased by 4%, what amount will Rs. 800 become in 3 years.

Rs 1052
Rs 1152
Rs 1252
Rs 1352

Answer: Option A

Explanation:

S.I. = 956 - 800 = Rs 156

\begin{aligned}
R = \frac{156*100}{800*3} \\
R = 6\frac{1}{2}\% \\

\text{ New Rate = }6\frac{1}{2}+4 \\
= \frac{21}{2} \% \\

\text{ New S.I. = }800\times\frac{21}{2}\times{3}{100} \\
= 252
\end{aligned}

Now amount will be 800 + 252 = 1052