12 www.tarainstitute.

in SIMPLE AND COMPOUND INTEREST

23. What annual payment will discharge a debt of ` 1025 25. What annual payment will discharge a debt of ` 50,440
due in 2 years at the rate of 5% compound interest? due in 3 years at 5% per annum compounded annually?
(a) ` 550 (b) ` 551.25 (a) ` 18,522 (b) ` 20,570
(c) ` 560 (d) ` 560.75 (c) ` 20,800 (d) ` 16,576
(e) None of these
24. The simple interest on a sum of money for 3 years is
` 240 and the compound interest on the sum at same
rate for 2 years in ` 170. The rate % p.a. is
(a) 16% (b) 8%
1 1
(c) 12 % (d) 8 %
2 3
(e) None of these
 www.tarainstitute.in 13

ANSWERS & EXPLANATIONS

EXERCISE 1
PR T
1. (d) S.I. 5760 3 6
100 9. (a) Required Simple Interest = = `
100
810 100 1036.80
P Rs1500
96
6420 7 4
2. (b) S. I. = 81 72 = ` 9 10. (e) Simple interest = 1797.60
100
9 100 4
T 2 years 11. (c) Let the required time = t years
72 25
3. (e) Let the principal be = `x Simple interest = (11442 9535) = `1907
Interest = (19050 x) PT R
Now, Simple =
100
Interest 100
Principal = 9535 4 t
Time Rate 1907
(19050 x) 100 100
x=
3 9 1907 100
27x = 1905000 100x t= = 5 years
127x =1905000 9535 4
1905000 12. (d) Interest = (25451 16420) = `9031
x = = `15000
127 Interest 100
4. (a) Interest on ` 1 in 4 years = ` 0.4 Rate
Principal Time
Interest on ` 100 in 4 years = ` 40
Interest on ` 100 in 1 year = ` 10 9031 100
PrincipalTimeRate = 11%
Interest = 16420 5
100
450 2 10 3460 6 8.5
= = ` 90 13. (b) Simple interest = = `1764.60
100 100
P R T 14. (b) Let the principal be = `100
5. (b) Simple Interest = Simple interest
100
31400 8 12 100 8 6
` 30144 = = `48
100 100
Required amount = ` (31400 + 30144) Amount (100 + 48) = `148
= ` 61544
When the amount is = `148, the principal =
(26350 21250) 100 `100
6. (e) Rate =
21250 6 When amount = `28046, the principal
510000
= = 4% 100
127500 = 28046 = `18950
48
Simple interest = (`28046 18950) = `9096
7. (a) SI = ` (12710 10250)= ` 2460
(31684 17800) 100
S.I. 100 2460 100 15. (d) Rate of Interest = %
time = = 6 years 17800 6
Principal Rate 10250 4
1388400
2 = = 13%
5 106800
8. (a) Required Amount = 15000 1 = `
100 5580 5 6.5
16537.50 16. (b) Required interest = ` = `1813.5
100
 14 www.tarainstitute.in SIMPLE AND COMPOUND INTEREST
PRT 107 3
17. (c) Simple interest = = 3080 100 1
100

56500 3 12
=` = 20340 1225043 1000000
100 = 3080
Required amount = ` (56500 + 20340) = `76840 1000000
8376 100 225043
18. (d) Amount invested = = 3080
8 6 1000000
= ` 17450 = ` 693 (approximate)
19. (c) Compound interest 24. (d) Compound Interest
2
15 R
T

= 8000 1 8000 p 1
100 1
100
3
23
= 8000 8000 4
2

20
8560 1 1
= 12167 8000 100
= ` 4167
Rate
Time 8560[(1.04) 2 1] 8560(1.0816 1)
20. (e) Amount = Principal 1
100 = 8560 0.0816 = `698.496 `698
2 T
8 R
= 5000 1+ 25. (b) Required Compound Interest = P 1 1
100 100
2
2
5000 1 2

25 8
= 3000 100 1
1
27 27
5000 5832 `
25 25
CI = ` (5832 5000) = 832 ` 27 2
T

= 3000 25 1
1
R
1
21. (b) Compount Interest = P
100
2
8 729 625
= 1250 1 1 = 3000
100 625
2
= 1250 [(1.08) 1)] 3000 104
=1250 (1.1664 1) = = `499.20
625
= ` (1250 0.1664)
= ` 208 14 8
26. (c) Required Amount = 24000 1
T 100
R
22. (c) Compound Interest = P 1 100 1 212
= 24000 = `50880
100
2
6
1
= 15800 100 1 Rate
Time

27. (b) Amount = Principal 1

100
= 15800 [(1.06)2 1)]
= 15800 (1.1236 1) 2

8
= 15800 0.1236 1250 1 1
= ` 1952.88 100
23. (b) Compound Interest 108 108 100 100
1250
7 3
100 100
= 3080 1 100 1

 www.tarainstitute.in 15

1250 1664 r 23
1
` 208 100 20
10000
r 23 3
Time
1
Rate 100 20 20
28. (e) Amount = Principal = 1 100 3
100 r= 15
20
3
5 33. (c) Compound interest
= 5690 1
100 3
12.5
8400 1 8400
21 21 21 100
= 5690 = `6586.90 = 11960.1562 8400
20 20 20
= ` 3560.1562
Compound interest = ` (6586.9 5690) =
3
`896.9 897 r
34 (d) 25500 1 25500
2 100
Rate
29. (c) Compound Interest = Principal 1 1 = 8440.5
100 3
r
25500 1
2
100
4 26 26
4500 1 1 4500 1 = 8440.5 + 25500
100 25 25 3
1 r 33940.5
676 625 51 100 25500
4500 = 4500 625 = `367.20
625 1331 3
11
=
30240 100 1000 10
30. (e) Rate 12%
84000 3 r 11

Compound interest 1
3
100 10
12 r 11
= 84000 1 84000 1
100 100 10
= 118013.95 84000
r 11 1
= ` 34013.95 1
100 10 10
31. (a) Simple interest 100
r 10
4000 5 2 10
= = ` 400 Simple interest
100
Compound interest 25500 10 3
2
=
5 100
= 4000 1 4000 = ` 7650
100
15300 100
4000 105 105 35 (e) Rate = = 8.5%
= 4000 45000 4
100 100
= 4410 4000 = ` 410 Compound interest
Difference = 410 400 4
8.5
= ` 10 = 45000 1 45000
100
2
r 4
32. (c) 14500 1 108.5
100 = 45000 1
= 14500 + 4676.25 100

r
2
19176.25 529 = 45000 0.3858 = ` 17364 (approx)
=
1 400 36. (a) Principal
100 14500
1200 100
2 2 =
r 23 48
1
100 20 = ` 3750
 16 www.tarainstitute.in SIMPLE AND COMPOUND INTEREST
Simple interest on thrice that principal
120 100
3750 3 6 3 R 10%
= 600 2
100
= ` 2025 7. (c) Difference in S.I. P T (R1 R 2 )
37. (a) Compound interest 100
2
5 P 4 2
= 35000 1 35000 56 ( R1 R2 = 2)
100 100
= 38587.50 35000
= ` 3587.50 56 100
P Rs 700
42

EXERCISE 2 8. (a)
16
25
P
PR R
100
1 1 1
1. (b) Rest part 1 1600 40
3 6 2 R2 R 8%
25 5
Rate % per annum on total sum
Also, time = 8 years
9. (a) Rate = 5 paise per rupee = 5%
1 1 1
3 6 8 6% 200 5 7
3 6 2 S.I. = ` 70
100
600 100 10. (c) Shortcut method :
P Rs 5, 000
6 2 If borrowed amount be ` M and it is to be paid in
2. (c) S.I. in I case = 2P P = ` P equal instalments, then
P 100 ra n(n 1)
R 10% M na
P 10 100 Y 2
Now, S.I. in II case = 3P P = ` 2P where Y = no. of instalments per annum
2P 100 a = annual instalment
T 20 years
P 10 Here, M = 4200, y = 1, r = 10, n = 5, a = ?
4P 100 2 10a 5(5 1)
3. (d) R 32% 4200 5a
5 P 5 100 2
1 4200 a 5 1 6a 4200
4. (b) Here S.I. P and R = T
9 a = ` 700
P 100 11. (b) Let the sum borrowed be x. Then,
R
9 PR x 6 2 x 9 3 x 14 4
100 100 100 11400
100 10 1
R2 R 3 %
9 3 3
3x 27x 14x 95x
5. (a) S.I. for 1 years = ` (1164 1008) = ` 156 11400 11400
25 100 25 100
156 2 2
S. I. for 2 years = ` Rs 208 11400 100
3 x 12000.
Principal = ` (1008 208) = ` 800 95
Now , P = 800, T= 2, S.I. = 208 Hence, sum borrowed = ` 12,000.
12. (a) Gain in 2 years
100 208
Rate % 13% 25 2 5000 4 2
800 2 = Rs. 5000
6. (b) S.I. for 5 years = ` (1020 720) = ` 300 4 100 100
300 = ` (625 400) = ` 225.
SI. for 2 years = Rs 2 Rs 120
5 225
Principal = ` (720 120) = ` 600
Gain in 1 year = Rs. = ` 112.50
2
Now, P = 600, T = 2, S.I. = 120
 www.tarainstitute.in 17

13. (d) We need to know the S.I., principal and time to 12, 000 10 1 x 20 1 (12000 x) 14 1
find the rate. Since the principal is not given, so
100 100 100
data is inadequate.
14. (c) Let the principal be P and rate of interest be R%. 120000 + 20 x = (12000 + x) 14
6x = 168000 120000
P R 6 x = ` 8000
100 6PR 6 Total investment = 12,000 + 8000 = ` 20,000

Required ratio = 2 : 3. 22. (b) Let sum be ` P. Then,
P R 9 9PR 9
100 2
r
4P P 1
100
15. (d) Difference of S.I. = Rs 31.50
Let each sum be ` x. Then r
1 2 r 100%
100
1
x4 7
2 x47 n
31.50 r
100 100 23. (c) A P1 ; A = Amount
100
7 x 1 63 P = Principal
or
100 2 2 r = rate of interest
or x = ` 900 n = time
3
16. (d) Let the rate be R% p.a. Then, 105
Required amount 1000
5000 R 2 3000 R 4 100
2200
100 100 21 21 21
= 1000
2200 20 20 20
100R 120R 2200 R 10.
220 = ` 1000 1.157 = ` 1157
17. (d) Let the original rate be R%. 24. (b) Here, n = 2 for interest is reckoned half-yearly.
Then, new rate = (2R)%. 3
2
10 2
725 R 1 362.50 2R 1 A 8, 000 1
33.50 2 100
100 100 3
3
(2175 725)R 33.50 100 3 10050 21
A 8, 000 Rs 9261 Rs9200
10050 20
R 3.46%
2900 5 5
R R
25. (a) P 1 2P 1 2 (i)
18. (c) 1500 R1 3 1500 R 2 3 13.50 100 100
100 100
n
R
Let P 1 8P
1350 100
4500(R1 R 2 ) 1350 R1 R 2 0.3%
4500 3
n 5
19. (c) Here S.I. = ` 9, P = Re 1 R 3 R
1 2 1 [By (i)]
9 100 100 100
R 15%
1 60 n 15
R R
9 PTT 1 1
20. (d) P 100 100
16 100
n = 15 years
900
2 30 1 26. (b) P becomes 2P in 6 years at r% p.a.
T T 7 years
16 4 2
21. (a) Let the second amount be ` x. Then,
 18 www.tarainstitute.in SIMPLE AND COMPOUND INTEREST

6 882 20 882 400

r
2P P 1 Rs.1640.
100 21 441

6
r 30. (b) For, T = 2 years
1 2
100 2 2
R 10
Required difference P 2000
r
64
r
24 100 100
24 1 1
100 100 = ` 20
31. (d) For T = 2 years
P becomes 16 P in 24 years
2
15 15 R
R R 2P Difference P
27. (b) P 1 2P 1 2 ..... (i) 100
100 100 P
2
R
n 15
Let P 1 8P
144 P
100 100

n 15
3 144 20 20
R R P Rs 6400
3 [using 33
1 8 2 1
100
100
32. (b) For T = 2 years,
(i)] R S.I.
n 45
C. I. S. I.
R R 2 100
1 1 n 45.
100 100 R 40
41 40
Thus, the required time = 45 years 2 100

28. (b) Let sum be ` P 2 100

R 5%
40
3 3
r r
3P P 1 1 3 (i)
100 100 = ` [21600 (2880 + 2400 + 2000)] = ` 14320.
n
33. (a) For T = 2 years,
r
Now, let P 1 9P R S.I.
100 C. I. S. I.
2 100
n 3 2
r 2
r 4 S.I.
1 9 3 1 [By (i)] 408 S.I.
100 2 100
100
204 S.I. 81600
n 6
r r
1 1 81600
100 100 S.I. Rs400
204
n=6
34. (b) Since, each year the profit is on the previous
29. (b) Principal years capital,
= (Present worth of ` 882 due 1 year hence) + it is similar to Compound Profit.
(Present worth of ` 882 due to 2 years hence) Compound Profit

5 10 15
882 882
40, 000 1 1 1 1
5 5
2 100 100 100
1
100 1 100
21 11 23
40, 000 1
20 10 20
 www.tarainstitute.in 19

= 40,000 [1.328 1]= ` 13, 130

xr 2 2xr
35. (a) For first year, S.I. = C.I. 4200
Now, ` 10 is S.I. on ` 100. 10000 100
20r + 4000 = 4200 [from (i)]
100
Rs. 16 is S.I. on Rs. 16 Rs.160. r = 10%
10 39. (a) % interest on total amount per annum
So, S.I. on principal for 1 year at 10% is ` 160
100 160 3620 100 362
Principal = Rs. Rs.1600. = %
10 1 16500 33
Amount for 2 years compounded half yearly Now, use Alligation method.

4
5
= Rs. 1600 1 Rs.1944.81.
100 Scheme Scheme

A B
C.I. = ` (1944.81 1600) = ` 24.81. 10% 12%
1600 10 2
S.I. = Rs. Rs. 320.
362
%
100 33
(C.I.) (S.I.) = ` (344.81 320) = ` 24.81.
36. (d) Let the principal be ` P and rate of interest be 362 362
R% per annum. 12 33 10
33
Differecne of C.I. and S.I. for 3 years
Hence, ratio of amount invested in schemes A and
R
3 P R 3 PR 300 R
2 B
P 1 P .
100 100 104 100 362 362
= 12 : 10 17 :16
33 33
2
R
Difference of C.I. and S.I. for 2 years = P 16 16500
100 Hence, amount invested in B = = ` 8000
17 16
PR 2 300 R 40. (c) Let the amount invested at 20% rate be ` x.
According to the question,
10 4 100 25 300 R 25

PR 2 8 100 8 10 20 14
12000 x (12000 x )
10 4 100 100 100

100 1 x 7
R 12 %. or, 1200 1680 x
8 2 5 50
n n
20 6 x 7
37. (b) P 1 2P or 2 or, x 480
100 5 5 50

6 6 6 6 3
Now, 2. So, n = 4 years or, x 480
5 5 5 5 50
38. (d) Let the money borrowed be ` x and the rate of x = ` 8000
interest charged = r% Total amount invested ` = (12000 + 8000)
Time = 2 years = ` 20000
xr2 41. (c) Let one gets = ` x
Now, 4000 = then, second gets = ` (68,000 x)
100
Given : A1 = A2
r x = 200000 ... (i)
x 10 8 (68000 x) 10 6
2 x (68, 000 x)
r 100 100
Again, x 1 x 4200
100
 20 www.tarainstitute.in SIMPLE AND COMPOUND INTEREST
x[100 80] (68, 000 x)[100 60] 20 P[(1 i)2 1 2i] P(i)2

180x 61 P[(1 i)3 1 3i] P (i3 3i 2 )
68, 000 x
160
i2 1
34x 68000 16 x ` 32, 000
3 2 3i
i 3i
second gets = ` 36,000
42. (d) Let the parts be x, y and [2379 (x + y)]. 1
60 20i 61 20i 1 i
5 5 20
x x 2 y y 3
100 100 r 1 r
As we know, i r 5
5 100 20 100
z z 4
100 1 1
Hence, P = 20 = 202020 = 8000.
i i
11x 23y 6z 10k 20k 5k 3. (a) Let A lent ` x and B lent ` y
kx ,y ,z
10 20 5 11 23 6 Since, A and B together lent out ` 81600
But x + y +z = 2379. x + y = 81,600
Now, given (r) Rate = 4%
10k 20k 5k
2379 4 26
11 23 6 1 r 1
100 25
1380 k + 1320 k + 1256 k = 2379 11 23
According to the question, we have
6
32
2379 11 23 6 3 11 23 6 x 26 26
k
3965 5 y 25 25

10 3 11 23 6 25
x 828. Investment made by B = 81600 40, 000
11 5 51
Hence, the first part is ` 828. 4. (c) Let the sum invested at 5% be ` x.

According to the question,

EXERCISE 3 x 5 4 (12000 x) 4 6
= 2580
110 100 100
1. (d) Population after 1st year = 10, 000
100
= 11000 20x 288000 24x 258000
Population after 2nd year
120 288000 258000 24x 20x
= 11000 13200
100
Population after 3rd year 4x 30000 x = ` 7500.
95 5. (c) Let the sum be ` x and rate % be R.
= 13200 12,540
100
x R 2
Hence, population after 3rd year = 12, 540. 720 x .......(1)
100
Pr t
2. (b) Let I1 x R 7
100 1020 x ...... (2)
100
and i)t
I2 = P (1+ P = P[(1+ i)t 1]
According to the question, 2Rx 7Rx
x+ 720 and x + 1020
20 = P [(1 + i)2 12i] and 61 100 100
= P [(1+ i)3 1 3i] 5Rx
300 (Subtracting)
On dividing, we get 100
5Rx = 30000 Rx = 6000
 www.tarainstitute.in 21

6000 2 x 10 8 (68000 x) 10 6
(1) 720 x x (68, 000 x)
100 100 100
x = ` 600, R = 10 %
x[100 80] (68, 000 x)[100 60]
Alternatively:
Interest for 5 yrs. = 1020 720 = ` 300 180x
68, 000 x
160
Interest for 2 yrs. = 120
Sum = 720 120 = ` 600 34x 68000 16 x Rs32,000
120 100
second gets = ` 36,000
Rate % = 10
Qr t Rrt
600 2
8. (b) P and Q
6. (d) Let the Rate % be R and P be principle. 100 100
Given : P Q rt

(C.I. S.I.) for 3 years 25 Q R 100
(C.I. S.I) for 2 years 8 Q2 = PR.
25 [(C.I. S.I.) for 2 years] 9. (b) Interest for one year
= 8 [(C.I. S.I.) for 3 years]
3 51
...(i) Rs. 212.50
1 Rs.
(C.I. S.I.) for 2 years 100 8
Thus in 8 years, the interest is ` 51.
2
R P R 2 10. (b) Let he borrowed at 5% = ` x
P 1 P
100 100 He borrowed at 7% = ` (2500 x)
Now I1 + I2 = 275
R2 2R 2 PR x 5 2 (2500 x) 7 2
P 1 P 275
10000 100 100 100 100
10x + 14 (2500 x) = 27500
P R2 PR 2 4x = 35000 27500 = 7500
P P ...(ii)
10000 10000 x = ` 1875
(C.I. S.I.) for 3 years Sum borrowed at 7% rate
= 2500 1875 = ` 625
3
R P R 3 11. (a) Let the sum be ` x. Then,
P 1 P
100 100
x 6 3 x 9 5 x 13 3
100 100 100 8160

R3 3R R 3RP
P 1 1 P 18 x + 45x + 39x = (8160 100)
(100)3 100 100 100 102x = 816000
x = 8000.
PR3 3PR 2 12. (a) Let the sum invested in Scheme A be ` x and that
...(iii)
1000000 10000 in Scheme B be ` (13900 x).
From (i), (ii) and (iii),
Then, x 14 2 (13900 x) 11 2 3508
PR2 R 3 100 100
25 8 PR 2
10000 1000000 10000 28x 22x = 350800 (13900 22)
6x = 45000
25 R 300
8 x = 7500.
10000 1000000 1000000 So, sum invested in Scheme B = ` (13900 7500)
1 = ` 6400.
8(R + 300) = 2500 R = 12 %. 13. (b) Let the sum invested at 9% be ` x and that
2
invested at 11% be ` (100000 x).
7. (c) Let one gets = ` x
Then,
then, second gets = ` (68,000 x)
Given : A1 = A2 x 9 1 (100000 x) 111

100 100
 22 www.tarainstitute.in SIMPLE AND COMPOUND INTEREST

39 1 2
10 968 10 10
100000 17. (c) 968 P 1
4 100 100 P Rs800
11 11
9x 1100000 11x 39000 18. (a) If x be the interest of third year, then 108% of
9750
100 4 x= 486
2x = (1100000 975000) = 125000 100
x = 62500. x 486 450
108
Sum invested at 9% = ` 62500.
19. (c) Let Principal P = ` x
Sum invested at 11% R = r%
= ` (100000 62500) = ` 37500. C.I. = 200 at the end of Ist year
14. (a) Let x, y and z be the amounts invested in schemes or 200 + 220 at the end of IInd year
A, B and C respectively. Then, We know that
x 10 1 y 12 1 z 15 1 n
100 100 100 3200 C.I. P 1
r
1

100
10x + 12y + 15z = 320000 ..... (i)
At the end of Ist year
12
Now, z = 240% of y = y ..... (ii) r
5 200 x 1 1
100
3
And, z = 150% of x = x
2 xr
200 (1)
100
2 2 12 8
x z y y ..... (iii) At the end of IInd year
3 3 5 5
2
From (i), (ii) and (iii), we have : r
420 x 1 1
16y + 12y + 36y = 320000 64y = 320000 100
y = 5000.
Sum invested in Scheme B = ` 5000. r r
x 2 (2)
15. (d) Let the parts be x, y and [2600 (x + y)]. Then, 100 100
x 4 1 y 6 1 [2600 (x y)] 8 1 On dividing (2) by (1) we get

100 100 100 420 r
2
y 4 2 2 200 100
or y x.
x 6 3 3 r
2.1 2
100
5
2600 x 8 r
x 4 1 3 2.1 2
So, 100
100 100 r = 0.10 100 r = 10%
(7800 5x) 8 20. (c) Let sum be ` P. Then,
4x 52x (7800 8)
3 2 2
20 6 36
A P 1 P P (i)
7800 8 100 5
25
x 1200.
52
2 2 4
Money invested at 4% = ` 1200. 20 11
and A 482 P 1 P
16. (a) Let the amount of the loss at 4% per annum 2 100 10
be ` x.
Amount given at 5% per annum = ` (1200 x) 36P 11
4

By (i), 482 P
x 4 2 (1200 x ) 5 2 25 10
Now, 110
100 100
x = ` 500 11 4 36
P 482
And, (1200 x) = 1200 500 = ` 700 10 25

 www.tarainstitute.in 23

23. (b) Let each instalment be ` x. Then,

14641 36
P 482 (Present worth of ` x due 1 year hence) +
10000 25 (Present worth of ` x due 2 years hence)
= ` 1025
14641 14400
P 482
10000 x x
1025
5 2
5
482 10000 1 1
P 20, 000 100 100
241
1 20x 400x
21. (c) Increment 100 12 1 % 1025
8 2 21 441

5/ 2 1025 441
25 820x 1025 441 551.25
H 10 1 820
100 2
So, value of each instalment = ` 551.25.
5/2 2 1/ 2
1
10 1
1 1
10 1 1 24. (c) S. I. for I year 240 Rs80 C.I. for I year
8 8 8 3
C. I for 2 years = ` 170 = C. I. for I year + C. I.
2
9 1 for II year
10 1 Now, C. I. for II year = 170 80 = ` 90
8 28
Interest on ` 80 for 1 year = 90 80 = ` 10
10 81 17 10

64
13.44ft
16 Rate of interest 100 12 1 %
80 2
Increment in height = 13.44 10 = 3.44 ft 25. (a) Let each instalment be ` x. Then,
22. (c) Let the value of each instalment be ` x. Then, (Present worth of ` x due 1 year hence) + Present
(present worth of ` x due 1 year hence) + (present worth of ` x due 2 years hence) + (Present
worth of ` x due 2 years hence) = ` 2550 worth of ` x due 3 years hence) = 50440
x x x x x
2550 50440
4 2 2 3
4 5 5 5
1 1 1 100 1 1 100
100 100 100

25x 625x 3
2550 20x 400x 20
26 676 x 50440
21 441 21
2550 676 50440
1275x 2550 676 1352.
1275 x 9261 Rs 18,522
25220
value of each instalment = ` 1352.