Simple Interest
Multiple Choice Questions (MCQ)
1.What is the correct formula for calculating Simple Interest?
a) S.I = P+R+T100
b) S.I = P+R+T100
c) S.I = P×R
d) S.I = P×TR
Answer: b) S.I = P+R+T100
2. A person borrows ₹10,000 at 6% per annum for 3 years. What is the simple interest?
a) ₹1200
b) ₹2000
c) ₹1800
d) ₹1600
Answer: c) ₹1800
3. If ₹2400 is invested at 5% per annum for 2.5 years, what is the interest earned?
a) ₹250
b) ₹300
c) ₹275
d) ₹350
Answer: b) ₹300
4. When time is given in months, to convert it into years, we—
a) Multiply by 12
b) Multiply by 30
c) Divide by 12
d) Divide by 365
Answer: c) Divide by 12
5. If the simple interest is ₹240, rate is 4% per annum and time is 2 years, what is the principal?
a) ₹3000
b) ₹2800
c) ₹2400
d) ₹2500
Answer: a) ₹3000
Short Answer Questions (SAQ)
1.Define simple interest.
Answer: Simple Interest is the extra amount paid or earned on a principal amount over a period of time at a fixed rate. It is calculated using the formula:
S.I = P+R+T100
2. If ₹100 is deposited at 5% per annum, what is the interest earned in 1 year?
Answer: Interest = ₹5
3. How is the total amount calculated in simple interest?
Answer: Total Amount (A) = Principal (P) + Simple Interest (S.I.)
Long Answer Questions (LAQ)
1. A person borrows ₹8000 at a rate of 7.5% per annum for 4 years.
Find the simple interest and the total amount payable.
Answer: Given:
P = ₹8000, R = 7.5%, T = 4 years
S.I = 8000 × 7.5 × 4100 =₹2400
A=P+S.I.=8000+2400=₹10,400
2. A student invests ₹3000 and earns ₹450 as interest in 3 years.
Find the annual rate of interest.
Answer: Given:
P = ₹3000, S.I. = ₹450, T = 3 years
R = S.I × 100 P × T = 450 × 1003000 × 3 = 450009000 =5%
Rate of Interest = 5% per annum