Simple Interest MCQ – Multiple Choice Questions & Answers

Q1 :

A man lent Rs. 600 to B for two years and Rs. 150 to C for 4 years and received altogether from both Rs. 90 as interest. Find the rate of interest, simple interest being reckoned.

A

4%

B

1%

C

6%

D

5%

View Answer

Correct Answer: D

5%

Description:

Let $x$ be the rate percent

$=frac{600 times x times 2}{100} + frac{150 times 4 times x}{100} = 90$

$12x +6x = 90 text{ or } x = 5$

Q2 :

What principal will amount of Rs. 560 in 3 years at 4 p.c. per annum simple interest?

A

425

B

450

C

475

D

500

View Answer

Correct Answer: D

500

Description:

$text{Principal } = frac{560 times 100}{100 + 4 times 3} = text{Rs.} 500$

Q3 :

$x,y,z$ are three sums of money such that $y$ is the simple interest on $x$ , and $z$ is the simple interest of $y$ for the same time and same rate. The relation between $x$ , $y$ and $z$ is

A

$y^2 = xz$

B

$z^2 = xy$

C

$x^2 = yz$

D

$xyz = 1$

View Answer

Correct Answer: A

$y^2 = xz$

Description:

Let $r$ be the rate and $t$ be the time

$y = frac{x times r times t}{100} text{ and } z = frac{y times r times t}{100}$

$frac{y}{z} = frac{x}{y} text{ or } y^2 = xz$

Q4 :

At what rate percent simple interest will a sum of money triple itself in 25 years?

A

5%

B

4%

C

6%

D

8%

View Answer

Correct Answer: D

8%

Description:

Rs. 100 becomes Rs. 300 means interest is Rs. 200 on Rs. 100 in 25 years

$text{Rate} = frac{200 times 100}{100 times 25} = 8%$

Q5 :

The simple interest on a sum of money is ${frac{1}{9}}$ of the principal, and the number of years is equal to the rate percent per annum. Find the rate percent.

A

$10{%}$

B

${frac {1}{3}% }$

C

$3%$

D

$3 {frac{1}{3}%}$

View Answer

Correct Answer: D

$3 {frac{1}{3}%}$

Description:

$=frac{1}{9} text{P} = frac{text{P} times text{R} times text{T} }{100}, text{but } r = t$

Q6 :

A man buys land and gives for it 25 times the annual rent. What rate percent of interest does he get for his money?

A

1%

B

2%

C

3%

D

4%

View Answer

Correct Answer: D

4%

Description:

Let the annual rent be $x$ so that the investment in $25x$ .

$text{ Rate } = frac{x times 100 }{25 times x} = 4%$

Q7 :

If the compound interest on a sum for 3 years at 5% is Rs. 1324.05, what is the simple interest ?

A

Rs. 1060

B

Rs. 1160

C

Rs. 1260

D

Rs. 1360

View Answer

Correct Answer: C

Rs. 1260

Description:

$text{ A = P } times Big(1 + frac{r}{100} Big)^n$

$= text{P } times Big(1 + frac{5}{100}Big)^3 = text{P } times Big(frac{9361}{8000}Big)$

$therefore$ If P = Rs. 8000, A = Rs. 9261

$therefore$ C.I. = Rs. 1261

Simple interest on Rs. 8000 for 3 years at 5% = Rs. 1200

Now if C.I. = Rs. 1261, SI = Rs. 1200 and if C.I. = Rs. 1324.50 then

$text{S.I. } = frac{1200}{1261} times 1324.05 = text{ Rs. } 1260$

Q8 :

A sum invested at 5% simple interest per annum grows to Rs. 504 in 4 years. The same amount at 10% simple interest per annum in $2frac{1}{2}$ years will grow to

A

Rs. 420

B

Rs. 450

C

Rs. 525

D

Rs. 550

View Answer

Correct Answer: C

Rs. 525

Description:

Let the principal amount P.

$therefore text{ P } + frac{text{ P } times 5 times 4}{100} = 504$
$Rightarrow 120 text{ P } = 50400 Rightarrow text{ P } = 420$
$therefore text{ The amount of Rs. } 420 text{ at }$
$10% text{ p.a., for } 2 frac{1}{2} text{ years }$
$= 420 + frac{420 times 10 times 5}{100 times 2}$
=Rs. 525

Q9 :

A sum of money at a simple rate of interest i₁double in 5 years. At another simple rate of interest i₂ , it becomes three times in 12 years. Then the two rates of interest i₁ and i₂ respectively, are:

A

$10% text{ ; } 16frac{2}{3}%$

B

$10% text{ ; } 20%$

C

$20% text{ ; } 16frac{2}{3}%$

D

$20% text{ ; } 30%$

View Answer

Correct Answer: C

$20% text{ ; } 16frac{2}{3}%$

Description:

Let P = 100, then A = 200

$therefore text{ I } = 100, text{ T } = 5 text{ years}$

$therefore i_1 = frac{text{ I } times 100}{text{P } times text{ T }} = frac{100 times 100}{100 times 5} = 20%$

$text{Again } i_2 = frac{200 times 100}{100 times 12} = 16frac{2}{3}%$

Q10 :

What is the rate of annual simple interest at which a sum of money would double itself in 25 years?

A

4%

B

5%

C

6%

D

8%

View Answer

Correct Answer: A

4%

Description:

$text{Rate } = frac{x times 100}{ x times 25} = 4%$

Simple Interest Questions and Answers