Aptitude - Compound Interest

Exercise :: Compound Interest - Data Sufficiency 1

Each of the questions given below consists of a statement and / or a question and two statements numbered I and II given below it. You have to decide whether the data provided in the statement(s) is / are sufficient to answer the given question. Read the both statements and

• Give answer (A) if the data in Statement I alone are sufficient to answer the question, while the data in Statement II alone are not sufficient to answer the question.
• Give answer (B) if the data in Statement II alone are sufficient to answer the question, while the data in Statement I alone are not sufficient to answer the question.
• Give answer (C) if the data either in Statement I or in Statement II alone are sufficient to answer the question.
• Give answer (D) if the data even in both Statements I and II together are not sufficient to answer the question.
• Give answer(E) if the data in both Statements I and II together are necessary to answer the question.
1.

 What is the rate of compound interest? I. The principal was invested for 4 years. II. The earned interest was Rs. 1491.

 A. I alone sufficient while II alone not sufficient to answer B. II alone sufficient while I alone not sufficient to answer C. Either I or II alone sufficient to answer D. Both I and II are not sufficient to answer E. Both I and II are necessary to answer

Explanation:

Let Principal = Rs. P and Rate = R% p.a. Then,

 Amount = Rs. P 1 + R 4 100 C.I. = P  1 + R 4 - 1 100 P  1 + R 4 - 1 = 1491. 100

Clearly, it does not give the answer. Correct answer is (D).

2.

 What will be compounded amount? I. Rs. 200 was borrowed for 192 months at 6% compounded annually. II. Rs. 200 was borrowed for 16 years at 6%.

 A. I alone sufficient while II alone not sufficient to answer B. II alone sufficient while I alone not sufficient to answer C. Either I or II alone sufficient to answer D. Both I and II are not sufficient to answer E. Both I and II are necessary to answer

Explanation:

 I. Amount = Rs. 200 x 1 + 6 16 100

 II. Amount = Rs. 200 x 1 + 6 16 100

Thus, I as well as II gives the answer. Correct answer is (C).

3.

 An amount of money was lent for 3 years. What will be the difference between the simple and the compound interest earned on it at the same rate? I. The rate of interest was 8 p.c.p.a. II. The total amount of simple interest was Rs. 1200.

 A. I alone sufficient while II alone not sufficient to answer B. II alone sufficient while I alone not sufficient to answer C. Either I or II alone sufficient to answer D. Both I and II are not sufficient to answer E. Both I and II are necessary to answer

Explanation:

Given: T = 3 years.

I. gives: R = 8% p.a.

II. gives: S.I. = Rs. 1200.

Thus, P = Rs. 5000, R = 8% p.a. and T = 3 years. Difference between C.I. and S.I. may be obtained.

So, the correct answer is (E).

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