Compound Interest Practice Test Set 5

Use the principal and amount (or the given interest information) to determine the annual growth factor and hence the rate.

Apply the formula and calculate:
Interest in 3rd year = 5,529.60 - 4,608 = Rs 921.60. Rate R = (921.60 / 4,608) * 100% = 20%.

Identify the given principal, rate and time, and determine whether the question asks for SI, CI, their difference, or an unknown value.

Apply the formula and calculate:
Difference for 3 years = P * (R/100)^2 * (300 + R)/100 = 40,000 * (1/400) * (305/100) = 100 * 3.05 = Rs 305.

Given principal $P = Rs 8,400$ and amount after 2 years $A = Rs 11,109$. Use $A = P(1 + r/100)^2$.

Substitute the values:
11,109 / 8,400 = (1 + r/100)^2

3225 = (1 + r/100)^2
Taking the square root, 1 + r/100 = 1.15.
Therefore, r/100 = 0.15 and r = 15%.

Compare the required amount with the principal using the compound-growth factor to determine the number of compounding periods.

Apply the formula and calculate:
$A/P = 1,440 / 1,000 = 1.44 = (1.2)^2$. Rate is 20% (multiplier 1.2). Thus time = 2 years.

Write down the given values and identify the compound-interest relationship needed to find the required quantity.

Apply the formula and calculate:
Effective CI % = 5 + 5 + 0.25 = 10.25%. P * 10.25% = 1,640 => $P = 1,640 / 0.1025 = Rs 16,000$.