Simple Interest

Question: 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?
[A].

Rs. 6400

[B].

Rs. 6500

[C].

Rs. 7200

[D].

Rs. 7500

Answer: Option A

Explanation:

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		+		(13900 – x) x 11 x 2		= 3508
		100				100

28x – 22x = 350800 – (13900 x 22)

6x = 45000

x = 7500.

So, sum invested in Scheme B = Rs. (13900 – 7500) = Rs. 6400.

Video Explanation: https://youtu.be/Xi4kU9y6ppk

Question:
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:

[A].

5%

[B].

7%

[C].

7	1	%
	8

[D].

10%

Answer: Option D

Explanation:

Let the rate be R% p.a.

Then,		5000 x R x 2		+		3000 x R x 4		= 2200.
		100				100

100R + 120R = 2200

R =		2200		= 10.
		220

Rate = 10%.

Question: A sum of money at simple interest amounts to Rs. 815 in 3 years and to Rs. 854 in 4 years. The sum is:
[A].

Rs. 650

[B].

Rs. 690

[C].

Rs. 698

[D].

Rs. 700

Answer: Option C

Explanation:

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.

Question:
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:

[A].

10%

[B].

10.25%

[C].

10.5%

[D].

None of these

Answer: Option B

Explanation:

Let the sum be Rs. 100. Then,

S.I. for first 6 months = Rs.		100 x 10 x 1		= Rs. 5
		100 x 2

S.I. for last 6 months = Rs.		105 x 10 x 1		= Rs. 5.25
		100 x 2

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

Effective rate = (110.25 – 100) = 10.25%

Question: 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?
[A].

1 : 3

[B].

1 : 4

[C].

2 : 3

[D].

Data inadequate

Answer: Option C

Explanation:

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

Required ratio =	P x R x 6 100	=	6PR	=	6	= 2 : 3.
	P x R x 9 100		9PR		9

Video Explanation: https://youtu.be/GaaEDwTWc6w

Question: A certain amount earns simple interest of Rs. 1750 after 7 years. Had the interest been 2% more, how much more interest would it have earned?
[A].

Rs. 35

[B].

Rs. 245

[C].

Rs. 350

[D].

Cannot be determined

Answer: Option D

Explanation:

We need to know the S.I., principal and time to find the rate.

Since the principal is not given, so data is inadequate.

Question:
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?

[A].

Rs. 4462.50

[B].

Rs. 8032.50

[C].

Rs. 8900

[D].

Rs. 8925

Answer: Option D

Explanation:

Principal	= Rs. 100 x 4016.25 9 x 5
	= Rs. 401625 45
	= Rs. 8925.

Question: 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:

[A].

Rs. 2000

[B].

Rs. 10,000

[C].

Rs. 15,000

[D].

Rs. 20,000

Answer: Option C

Explanation:

Principal = Rs.		100 x 5400		= Rs. 15000.
		12 x 3

Question: 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?
[A].

3.6

[B].

6

[C].

18

[D].

Cannot be determined

Answer: Option B

Explanation:

Let rate = R% and time = R years.

Then,		1200 x R x R		= 432
		100

12R2 = 432

R2 = 36

R = 6.

Video Explanation: https://youtu.be/TjjI4iRkzT0

Question: 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?
[A].

3%

[B].

4%

[C].

5%

[D].

6%

Answer: Option D

Explanation:

S.I. = Rs. (15500 – 12500) = Rs. 3000.

Rate =		100 x 3000	%	= 6%
		12500 x 4

Video Explanation: https://youtu.be/SIcQu1HOmOk