Simple and Compound Interest by Tushar Kashyap
SIMPLE INTEREST : -
Simple Interest is a method of calcula ng interest where the interest is calculated only on the original principal amount, not on any
interest previously added.
Defini on:
Simple Interest is the amount paid or earned on the principal over me, calculated using a fixed rate of interest.
Formula for Simple Interest:
Simple Interest=P×R×T/100
Where:
P = Principal amount (the original money)
R = Rate of interest (in percentage)
T = Time period (in years)
Suppose you invest ₹10,000 in a bank at an interest rate of 8% per year for 3 years.
P = ₹10,000
R = 8%
T = 3 years
Using the formula:
Simple Interest=10,000×8×3 /100=₹2,400
Simple and Compound Interest by Tushar Kashyap
So, the total interest you would earn a er 3 years is ₹2,400.
A er 3 years, you would have ₹10,000 (the principal) + ₹2,400 (interest) = ₹12,400 in total.
Simple and Compound Interest by Tushar Kashyap
JKSSB PYQS Based on simple
interest
Q1 Let's say you invest 1,000 (the
principal) at an annual interest
rate of 5% for 3 years.
Q2 Ram borrowed Rs. 5,000 from
Sanjay with simple interest. A er
2 years, Sanjay got Rs. 1,000
more than what he had given to
Ram. What was the percentage
of interest per annum?
A
15
B
10
C
20
D
5
Q3 Simple interest on a certain
amount is 9/16 of the principal. If
the number represen ng the rate
of interest in percent and me in
Simple and Compound Interest by Tushar Kashyap
years be equal, then me, for
which the principal is lent out, is:
A 5½ years
B 6½ years
C 7 years
D 7½ years
Q4 The difference in simple
interest at 13% and 12% p.a. of a
sum in one year is Rs. 110. Then
the sum is
A Rs. 10,000
B Rs. 15000
C Rs. 11000
D Rs. 13000
Q5 Find the sum of money which
increases 1/10 of itself every
year and amounts to Rs. 450 in 5
years at S.I__
A 250
Simple and Compound Interest by Tushar Kashyap
B 300
C 400
D 350
Q6 A sum of Rs. 1600 lent at
simple interest at 12.5% per
annum will become double in
A 7.5 years
B 6 years
C 8 years
D 91/4years
Q7 S.I. on Rs. 1500 at 7% per
annum for a certain me is Rs.
210. Find the me.
A 3 years
B 1.5 years
C 2 years
D 2.8 years
Simple and Compound Interest by Tushar Kashyap
Q8 A sum was put at simple
interest at a certain rate for 2
years. Had it been put at 3%
higher rate, it would have
fetched Rs. 72 more find the
sum:
A 1500
B 1000
C 1200
D 1300
Q9 A sum was put at simple
interest at a certain rate for 2
years. Had it been put at 1%
higher rate, it would have
fetched Rs. 24 more. Find the
sum.
A 2000
B 1200
C 2400
D 1600
Simple and Compound Interest by Tushar Kashyap
SSC PYQS Based on simple interest
Q10 A certain amount double
itself in 3.5
years. In how much me it would
become 7 mes of itself?
20
21
22
Q11 A certain sum is lent at 4%
per annum for 3 years, 8%
per annum for next 4 years and
12% per annum beyond
7 years. If for a period of 11 years
the simple interest
obtained is Rs.27600, the sum is
(in Rs.):
CGL 2019 Tier II 15-11-2020
A. Rs.27000
B. Rs. 25000
C. Rs.30000
D. Rs.32000
Simple and Compound Interest by Tushar Kashyap
Q 12 A sum at a certain rate of
simple interest
becomes Rs.14880 a er 3 years
and Rs.16800
a er 5 years. Find the simple
interest on the
same sum at 10% per annum for
4 years. (in Rs.)
A. 5184
B. 4740
C. 4800
D. 486
Q13 A sum of Rs. 5160 amounts
to Rs. 6360 at 12.35%
p.a. simple interest in certain
me. Find the Amount
if the sum of Rs.5203 is given at
the same rate for
the same me?
6413
6403
6513
6613
Simple and Compound Interest by Tushar Kashyap
Q 14 If rate of interest increased
by 14.28% and
me decreased from 4.5 to 2.5
years then
simple interest decreased by 920.
Find the
decreased S.I.
Q 15 If rate of interest increased
from 20% to
23% and me dura on is also
increased
from 3.5 years to 4.5 years then
Simple
interest increased by 3350. Find
the
increased S.I?
Q16 If An amount becomes twice
of itself
in 7 years, find the rate of
interest.
10%
12.5%
14.29%
16.66%
Simple and Compound Interest by Tushar Kashyap
COMPOUND INTEREST :
Compound interest is a way to earn interest on both the money you originally invested
(called the principal) and the interest that has been added to it over me.
Let’s explain it step-by-step with an example:
Example:
Imagine you invest ₹1,000 in a bank that gives 10% compound interest annually. This
means, a er 1 year, the bank will pay you 10% interest on ₹1,000.
A er 1 year:
o You earn 10% of ₹1,000 = ₹100.
o So, your new total amount is ₹1,000 + ₹100 = ₹1,100.
A er 2 years:
o Now, you earn 10% of ₹1,100 (not just ₹1,000 anymore).
o 10% of ₹1,100 = ₹110.
o So, your new total amount is ₹1,100 + ₹110 = ₹1,210.
A er 3 years:
o Now, you earn 10% of ₹1,210.
o 10% of ₹1,210 = ₹121.
o Your total a er 3 years is ₹1,210 + ₹121 = ₹1,331.
Key Points:
Compound Interest means you earn interest not just on your ini al amount, but also
on the interest that gets added each year.
It grows faster over me because the interest keeps ge ng added to the principal.
In simple terms, your money grows faster each year because you are earning interest on
your interest as well!
Simple and Compound Interest by Tushar Kashyap
Simple and Compound Interest by Tushar Kashyap
USING COMPOUND INTEREST FORMULA :
When interest is compounded annually :
Simple and Compound Interest by Tushar Kashyap
When interest is compounded half yearly :
Simple and Compound Interest by Tushar Kashyap
PREVIOUS YEAR QUESTIONS ON COMPOUND INTEREST
Q1 Find the interest
generated in 3rd year on
6591 rupees at 7.69% p.a
compounded
annually ?
196
588
288
576
Q2 Find the interest
generated in 16 months on
25000 rupees at 12% p.a
compounded 4-
monthly ?
4264.464
4246.414
4246.432
4246.064
Q3 Find the interest
generated in 2 years on
8000 rupees at 15% p.a
compounded 8
monthly ?
2644
2641
2648
2646
Simple and Compound Interest by Tushar Kashyap
Q4 Find the compound
interest generated in
7th year at the rate of
interest 25℅ p.a
compounded annually ,if
compound
interested earned in 4th is
10000 ?
Cnd
19531.25
19531.75
19531
Q5 Find the compound
interest generated in
year 2008 year at the rate
of interest 10℅
p.a compounded annually
,if compound
interested earned in year
2005 is 5000?
5566
6655
6650
6645
Simple and Compound Interest by Tushar Kashyap
Q6 A Sum of Rs. 1728 is
invested in 15 months at
10%
per annum compounded
half yearly. What is the
percent gain, correct to
one decimal place at the
end of 15 months ?
(a)12.5%
(b) 13.6%
(c) 13.0%
(d)13.4
Q7 If the difference
between the compound
interest and the
simple interest on a certain
sum of money for 3 years
at
10% per annum,
compounded annually, is ₹
279, then find
the amount (in ₹).
A. 10,000
B. 9,000
C. 7,500
D. 8,000
Simple and Compound Interest by Tushar Kashyap
Q8 A sum of Rs 18000 is
lent at 10% p.a
compound interest,
compounded annually.
What is the difference
between the
compound interest for 3rd
year and 4th
year?
217.80
220.60
215.40
221.80
Q9 What is the difference
between the
Compound interest and
Simple interest,
When interest is
compounded 5-monthly
on a sum of 12500 for 5/4
years at 12% p.a
?
94.8
93
94
95.3
Simple and Compound Interest by Tushar Kashyap
Q10 Find the difference
between C.I and
S.I for three years on 15625
and rate
of interest compounded
annually is
12% p.a ?
640
702
720
625