Simple Interest Formula Test Questions and Answers


question divider line

Home > Numerical Tests > Simple Interest > Simple Interest Formula Test Questions

question divider line

Simple interest is normally expressed as a percentage and is normally used to show what either has to be paid to borrow money or lend money. By borrowing / lending the principal amount (the loan amount) you would normally expect to receive something in return or pay something because of this loan. This is normally expressed as a percentage and is called the simple interest rate. There is also something called the Compound Interest Rate Formula but that you can read more about in the link just provided.

The formula for simple interest is the following: Simple Interest = Principal*Interest Rate*Time

This means that to calculate the simple interest amount you just need to know the interest rate and the time scale and the principal amount. Let's look at an example:

Principal: 100 Simple Interest: 5% (will be expressed as 0.05 in calculations) Time: 1 Year Simple Interest Amount: 100*0.05*1 = 5

If the Time period was 2 Years then it would just be 100*0.05*2=10

Now let's look at some questions using this newly learnt simple interest formula.

A sum of money amounts to 9800 after 5 years and 12005 after 8 years at the same rate of simple interest. The rate of interest per annum is:


A. 5%
B. 8%
C. 12%
D. 15%

Answer & Explanation:

Answer: Option C

Explanation: S.I. for 3 years = (12005 - 9800) = 2205.

S.I. for 5 years = (2205/3)x 5 = 3675

Principal = (9800 - 3675) = 6125.

Hence, interest rate = (100 x 3675)/(6125x5)% = 12%



question divider line

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 & Explanation:

Answer: Option C

Explanation:

Simple Interest Questions and Answers


question divider line
question divider line

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


A. 35
B. 245
C. 350
D. Cannot be determined

Answer & Explanation:

Answer: Option D

Explanation: We need to know the S.I (simple interest)., principal and time to find the rate.

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



question divider line

Page 1   | Page 2   | Page 3  

question divider line

More educational and fun tests below.




Questions or comments? Please discuss below.




Copyright © The Online Test Centre - Since 2005 | Terms and Conditions & Privacy Policy | Blog


The largest provider of tests on the web. We have thousands of questions covering

 

numerical and verbal aptitude tests, diagrammatic and logic tests, reasoning tests,

 

puzzles, general knowledge test questions and GMAT test advice and questions.

 

No login required. All tests are free. All the tests you need when you need them.