Five challenge on 11.11.

14
Compound Interest

1. The height of a tree increase every year 1/8 times .If the present height of the tree is 64 cm, then
what will be its height after 2years ?
(a) 76 cm
(b ) 80 cm
(c ) 81 cm
(d ) 84 cm
(e ) None of these
Solution: (c) .
Initial height = 64
First year = 1/8(64) = 8
So 8+64 = 72cm
Second year = 1/8(72) = 9
So 9+72 = 81cm

2. The Simple Interest on a certain sum for 2 years is Rs.120 and the compound interest is
Rs. 129. Find the rate of interest .

(a ) 14%
(b) 15 %
(c ) 12 %
(d ) 12 % (e ) Cannot be determined
Solution ; (b).
Interest for first year in Simple Interest and Compound Interest are same
So we need to blind first year interest .
Simple interest for every year will be same
= Simple Interest for 2 years = 120
1 year = 120/2 = 60
So first year interest of Compound Interest = 60
The difference between simple interest and compound interest for 2nd year is a. So find a is what %
of 60
= 9/60 X 100 = 15%

3. At what percentage annual compound interest rate , a certain sum amounts to its 27 times in 3
years ?
( a) 100% (b ) 150 % (c ) 75% (d ) 200% (e ) 900%
Solution: (d).
Let the principal be P
N=3
Amount = 27P
= 27P = P ( 1+ R/100)3
While solving
(3)3 = ( 1+R/100)3
Therefore 3 = 1 + R/100
=R/100 = 3-1
So R = 200%

4. Find the least number of complete years in which a sum of money put out at 40% compound
interest will be more than double .
(a ) 3yr (b ) 4 yr (c ) 5yr (d ) 8 yr (e ) None of these

5. what amount will be received on a sum of Rs.15000 in 1 yrs at 10% per annum, if interest is
compounded half yearly ?
(a ) 4996.5

(b ) 19996.5 (c ) 23999.5 (d ) 21609.25

(e ) 18996.75