Simple & Compound Interest(Quantitative Aptitude > Interest ) Questions and answers for exam Preparation

Quantitative Aptitude > Interest

SIMPLE & COMPOUND INTEREST MCQs

Compound Interest, Simple Interest, Interest (combined)

Total Questions : 1171 | Page 118 of 118 pages

Question 1171. 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 :_________?

10%
10.25%
10.50%
None of these

Discuss Question

Answer: Option B. -> 10.25%
LET THE SUM BE RS. 100. THEN, S.I. FOR FIRST 6 MONTHS = RS. ( 100 X 10 X 1/100 X 2 ) = RS. 5. S.I. FOR LAST 6 MONTHS = RS. ( 105 X 10 X 1/100 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%.