1. $45,000 is deposited into a savings account.

After one year, 4 months

and 20 days it totals $52,500. Calculate the simple interest rate for this
account.
360 + 120 + 20 = 500 days
I = 52 500 45 000 = $7,500

2. How long does it take a principal of $25,000 at a simple interest rate of

5% to become $30,000?

3. Determine the simple interest rate applied to a principal over 20 years

if the total interest paid equals the borrowed principal.
I=P

4. How long does it take a principal payment to triple at a simple interst

rate of 6%?
I=3P

5. Find the total amount of simple interest that is paid over a perod of five
years on a principal of $ 30,000 at a simple interest rate of 6%.

6. Calculate the total worth of an investment after six months with a

principal of $10,000 at a simple interest rate of 3.5%.

7. If you deposit $4000 into an account paying 6% annual interest

compounded quarterly, how much money will be in the account
after 5 years?
F=4000(1+ 0.06/4)^(4)(5)
=4000(1.015)^20
F=5387.42
8. If you deposit $6500 into an account paying 8% annual interest
compounded monthly, how much money will be in the account
after 7 years?
9. Sarah deposits $4,000 at a bank at an interest rate of 4.5% per year.
How much interest will she earn at the end of 3 years?
Solution:
Simple Interest = 4,000 4.5% 3 = 540
She earns $540 at the end of 3 years.
10. Wanda borrowed $3,000 from a bank at an interest rate of 12% per
year for a 2-year period. How much interest does she have to pay the bank
at the end of 2 years?
Solution :
Simple Interest = 3,000 12% 2 = 720
She has to pay the bank $720 at the end of 2 years.
11. Raymond bought a car for $40, 000. He took a $20,000 loan from a
bank at an interest rate of 15% per year for a 3-year period. What is the
total amount (interest and loan) that he would have to pay the bank at the
end of 3 years?
Solution :
Simple Interest = 20,000 13% 3 = 7,800
At the end of 3 years, he would have to pay

$20,000 + $7,800 = $27,800

12. Moho wants to invest R 30 000 into an account that offers a compound
interest rate of 6% p.a. How much money will be in the account at the end
of 4 years?

A=P(1+i)n
A=30000(1+0,06)4
=37874,31
Moho will have R 37 874,31 in the account at the end of 4 years.

13. A sum of money at simple interest amounts to Rs. 815 in 3 years and to Rs. 854 in 4
years. The sum is:
S.I. for 1 year = Rs. (854 - 815) = Rs. 39.
S.I. for 3 years = Rs.(39 x 3) = Rs. 117.
Principal = Rs. (815 - 117) = Rs. 698.
14. Mr. Thomas invested an amount of Rs. 13,900 divided in two different schemes A and B
at the simple interest rate of 14% p.a. and 11% p.a. respectively. If the total amount of
simple interest earned in 2 years be Rs. 3508, what was the amount invested in Scheme B?
Let the sum invested in Scheme A be Rs. x and that in Scheme B be Rs. (13900 - x).

Then,

x x 14 x 2
100

(13900 - x) x 11 x 2
100

28x - 22x = 350800 - (13900 x 22)

6x = 45000
x = 7500.
So, sum invested in Scheme B = Rs. (13900 - 7500) = Rs. 6400.

= 3508

15. A sum fetched a total simple interest of Rs. 4016.25 at the rate of 9 p.c.p.a. in 5 years.
What is the sum?
Principal

100 x 4016.25

= Rs.

9x5

= Rs.

401625
45

= Rs. 8925.
16. How much time will it take for an amount of Rs. 450 to yield Rs. 81 as interest at 4.5%
per annum of simple interest?

Time = 100 x 81 years= 4 years.450 x 4.5

17. Reena took a loan of Rs. 1200 with simple interest for as many years as the rate of
interest. If she paid Rs. 432 as interest at the end of the loan period, what was the rate of
interest?
Let rate = R% and time = R years.

Then,

1200 x R x R

= 432

100
12R2 = 432
R2 = 36
R = 6.
18. A sum of Rs. 12,500 amounts to Rs. 15,500 in 4 years at the rate of simple interest.
What is the rate of interest?
S.I. = Rs. (15500 - 12500) = Rs. 3000.

Rate =

100 x 3000
%

= 6%

19. An automobile 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:
Let the sum be Rs. 100. Then,
100 x 10 x 1

S.I. for first 6 months = Rs.

= Rs. 5

100 x 2
105 x 10 x 1

S.I. for last 6 months = Rs.

100 x 2

= Rs. 5.25

So, amount at the end of 1 year = Rs. (100 + 5 + 5.25) = Rs. 110.25

Effective rate = (110.25 - 100) = 10.25%

20. A lent Rs. 5000 to B for 2 years and Rs. 3000 to C for 4 years on simple interest at the
same rate of interest and received Rs. 2200 in all from both of them as interest. The rate of
interest per annum is:
Let the rate be R% p.a.
5000 x R x 2

Then,

100

3000 x R x 4

100

= 2200.

100R + 120R = 2200

R=

2200
220

= 10.

Rate = 10%.
21. A sum of Rs. 725 is lent in the beginning of a year at a certain rate of interest. After 8
months, a sum of Rs. 362.50 more is lent but at the rate twice the former. At the end of the
year, Rs. 33.50 is earned as interest from both the loans. What was the original rate of
interest?

Let the original rate be R%. Then, new rate = (2R)%.

Note:
Here, original rate is for 1 year(s); the new rate is for only 4 months i.e.
725 x R x 1
100

year(s).

362.50 x 2R x 1

= 33.50

100 x 3

(2175 + 725) R = 33.50 x 100 x 3

(2175 + 725) R = 10050
(2900)R = 10050
R=

10050

= 3.46

2900

Original rate = 3.46%

22. A man took loan from a bank at the rate of 12% p.a. simple interest. After 3 years he
had to pay Rs. 5400 interest only for the period. The principal amount borrowed by him
was:

Principal = Rs. 100 x 5400 = Rs. 15000.12 x 3

23. A sum of money amounts to Rs. 9800 after 5 years and Rs. 12005 after 8 years at the
same rate of simple interest. The rate of interest per annum is:
S.I. for 3 years = Rs. (12005 - 9800) = Rs. 2205.

S.I. for 5 years = Rs.

2205
3

x5

= Rs. 3675

Principal = Rs. (9800 - 3675) = Rs. 6125.

Hence, rate =

100 x 3675
6125 x 5

= 12%

24. What will be the ratio of simple interest earned by certain amount at the same rate of interest for
6 years and that for 9 years?

Let the principal be P and rate of interest be R%.

PxRx6
100

Required ratio =

6PR

PxRx9

9PR

= 2 : 3.

100

25. A person borrows Rs. 5000 for 2 years at 4% p.a. simple interest. He immediately lends it to
another person at 6

Gain in 2 years

p.a for 2 years. Find his gain in the transaction per year.

= Rs.

5000 x

25

5000 x 4 x 2

100

100

= Rs. (625 - 400)

= Rs. 225.
225

Gain in 1 year = Rs.

= Rs. 112.50

26. Simple interest on a certain sum of money for 3 years at 8% per annum is half the compound
interest on Rs. 4000 for 2 years at 10% per annum. The sum placed on simple interest is:
10
= Rs.

4000 x

1+

- 4000

100

C.I.
= Rs.

4000 x

11
10

11

- 4000

10

= Rs. 840.
Sum = Rs.

420 x 100

= Rs. 1750.

3x8
27. If the simple interest on a sum of money for 2 years at 5% per annum is Rs. 50, what is the
compound interest on the same at the same rate and for the same time?

50 x 100

Sum = Rs.

= Rs. 500.

2x5

Amount

5
= Rs.

500 x

= Rs.

1+

500 x

100

21

21

20

20

= Rs. 551.25
C.I. = Rs. (551.25 - 500) = Rs. 51.25

28. The difference between simple interest and compound on Rs. 1200 for one year at 10% per
annum reckoned half-yearly is:
1200 x 10 x 1

S.I. = Rs

= Rs. 120.

100
5
C.I. = Rs.

1200 x

1+

- 1200

100

= Rs. 123.

Difference = Rs. (123 - 120) = Rs. 3.

29. The difference between compound interest and simple interest on an amount of Rs. 15,000 for 2
years is Rs. 96. What is the rate of interest per annum?
R
15000 x

1+

100

- 15000
R

15000

1+

100

2R

-1-

100

= 96

= 96

100

(100 + R)2 - 10000 - (200 x R)

15000

= 96

10000
R2 =

R = 8.

15000 x R x 2

96 x 2
3

= 64

Rate = 8
30. The compound interest on a certain sum for 2 years at 10% per annum is Rs. 525. The simple
interest on the same sum for double the time at half the rate percent per annum is:
Let the sum be Rs. P.
10
Then,

1+

-P

100

11
P

= 525

-1

10

= 525

525 x 100

P=

= 2500.

21

Sum = Rs . 2500.
2500 x 5 x 4

So, S.I. = Rs.

= Rs. 500

100

31. A bank offers 5% compound interest calculated on half-yearly basis. A customer deposits Rs. 1600
st
st
each on 1 January and 1 July of a year. At the end of the year, the amount he would have gained by
way of interest is:
Amount
5
= Rs.

1600 x

= Rs.

1+

1600 x

+ 1600 x

2 x 100

41
40

= Rs.

41

1+

+ 1600
x

40

+1
41
40

= Rs.

40

1600 x 41 x 81
40 x 40

= Rs. 3321.

41
40

1600 x
41

2 x 100

C.I. = Rs. (3321 - 3200) = Rs. 121

32. The difference between simple and compound interests compounded annually on a certain sum of
money for 2 years at 4% per annum is Re. 1. The sum (in Rs.) is:
x

C.I.
=

1+

-x

676

100

625
xx4x2

S.I. =

-x

51x

2x

625

625
2x

100

51

25
=1

25

x = 625.

33. There is 60% increase in an amount in 6 years at simple interest. What will be the compound
interest of Rs. 12,000 after 3 years at the same rate?
Let P = Rs. 100. Then, S.I. Rs. 60 and T = 6 years.
100 x 60

R=

= 10% p.a.

100 x 6

Now, P = Rs. 12000. T = 3 years and R = 10% p.a.

C.I.
10
= Rs.

= Rs.

12000 x

1+

12000 x

100

-1

331
1000

x.

= 3972.

34. What is the difference between the compound interests on Rs. 5000 for 1
annum compounded yearly and half-yearly?
C.I. when interest
compounded yearly
5000 x
= Rs.

1+

years at 4% per

1+
x4

100

= Rs.

5000 x

100

26

51
25

= Rs. 5304.
C.I. when interest is
compounded half-yearly
= Rs.
5000 x

1+

50

100

= Rs.

5000 x

51

51
50

51

50

50

= Rs. 5306.04
Difference = Rs. (5306.04 - 5304) = Rs. 2.04
35. The compound interest on Rs. 30,000 at 7% per annum is Rs. 4347. The period (in years) is:
Amount = Rs. (30000 + 4347) = Rs. 34347.
Let the time be n years.
1+

Then, 30000

= 34347

100
107

34347

11449

107

100

30000

10000

100

n = 2 years.

36. What will be the compound interest on a sum of Rs. 25,000 after 3 years at the rate of
12 p.c.p.a.?
Amount
12
= Rs.

25000 x

= Rs.

25000 x

1+

28

100

28

25

28
25

25

= Rs. 35123.20
C.I. = Rs. (35123.20 - 25000) = Rs. 10123.20

37. At what rate of compound interest per annum will a sum of Rs. 1200 become Rs.
1348.32 in 2 years?
Let the rate be R% p.a.
1+

Then, 1200 x

= 1348.32

100
R

1+

100

134832

120000

1+

100

10000
106

1+

11236

106

100

100
100

R = 6%
38. The least number of complete years in which a sum of money put out at 20% compound interest
will be more than doubled is:

1+
Now,

20

n
6
5

> 2P

100
x

6
5

5
x

6
5

6
5

> 2.
> 2.

So, n = 4 years.

39. Albert invested an amount of Rs. 8000 in a fixed deposit scheme for 2 years at compound interest
rate 5 p.c.p.a. How much amount will Albert get on maturity of the fixed deposit?
Amount

5
= Rs.

8000 x

= Rs.

8000 x

1+

100

21

21
20

20

= Rs. 8820.
40. The effective annual rate of interest corresponding to a nominal rate of 6% per annum payable
half-yearly is:
Amoun
t of Rs.
100 for
1 year
when
compo
unded
halfyearly

= Rs.

100 x

1+

= Rs.
106.09

100
Effective rate = (106.09 - 100)% = 6.09%

41 Tim invested $ 1500 for at the rate of 6% p.a. for 7 years and 3 months. Find the
amount he got back.
Solution:
Principal (P) = $ 2000,
Rate (R) = 6% p.a.
Time (T) = 7 years and 3 months.
[We know, when T i.e., the time is given in months then it should be divided by 12 to convert
into years].

= 7 3/12 years.
= 7 years.
= (7 4 + 1)/4 years.
= 29/4 years.
Simple Interest (SI) = (P R T)/100
Simple Interest (SI) = (2000 6 29)/(100 4)
= 348000/400
= 870
Therefore, Amount = Principal + Simple Interest
= 2000 + 870
Therefore, Amount Tim got back = $ 2870
42. Kyle borrowed $ 3400 at the rate of 8% p.a. for 225 days. Find the interest and amount she
paid.
Solution:
Principal = $ 3400,
Rate = 8% p.a.
Time = 225 days.
[We know, when T i.e., the time is given in days then it should be divided by 365 to convert
into years].
= 225/365 years.
Simple Interest = (P R T)/100
= (3400 8 225)/(100 365)
= 6120000/36500
= $ 167.67
Amount = Principal + Simple Interest

= 3400 + 167.67
= $ 3567.67
Therefore, Amount paid by Kyle is $ 3567.67.
And the Interest paid by Kyle is $ 167.67.
43.