Mathematical Aptitude - Interest

17. Nagarjuna invested some money at compound rate of interest. His amount gets doubled in 9 years. In how many years will the amount become four times itself?

  • Option : D
  • Explanation : Let amount be Rs ‘A’
    It becomes double = 2A in 9 years.
    In next 9 years it again double i.e., becomes 2 × 2A = 4A
    So in 9 + 9 = 18 years the amount becomes four times itself.
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18. If at same rate of interest, in 2 years the simple interest is Rs 40 and compound interest is Rs 41, then what is the rate of interest

  • Option : B
  • Explanation : Simple interest for each year = 40/2 = Rs 20
    Compound Interest for first year is Rs 20 and for second year = 41 – 20 = 21
    Thus Rs 20 becomes Rs 21, thus rate of interest can be calculated
    P = Rs 20, SI = Rs 1, T = 1 year
    So R = SI × 100/P × T = 1 × 100/20 × 1 = 5%
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19. If a sum of money invested at compound interest becomes Rs 800 in 3 years and Rs 840 in 4 years. Then what is the rate of interest per annum?

  • Option : A
  • Explanation : 4 years – 3 years = 1 year
    Thus, we can say that Rs 800 becomes Rs 840 in 1 year.
    ∴ Interest = Rs 840 – Rs 800 = Rs 40
    For 1 year time period, Simple Intesest = Compound Interest
    interest
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