Simple Interest MCQ & Objective Questions
Understanding Simple Interest is crucial for students preparing for school and competitive exams in India. This topic not only forms a fundamental part of mathematics but also frequently appears in various examination formats. Practicing MCQs and objective questions on Simple Interest can significantly enhance your exam preparation, helping you score better by reinforcing key concepts and problem-solving skills.
What You Will Practise Here
Definition and formula of Simple Interest
Calculation of Principal, Rate, and Time
Applications of Simple Interest in real-life scenarios
Comparison between Simple Interest and Compound Interest
Word problems involving Simple Interest
Understanding the concept of maturity amount
Common variations of Simple Interest problems
Exam Relevance
Simple Interest is a vital topic in the curriculum for CBSE, State Boards, NEET, JEE, and other competitive exams. Students can expect questions that test their understanding of the formula, application in real-life contexts, and problem-solving abilities. Common question patterns include direct calculations, word problems, and comparative analysis with Compound Interest, making it essential to master this topic for success in exams.
Common Mistakes Students Make
Confusing the formulas for Simple Interest and Compound Interest
Incorrectly identifying the principal amount or rate of interest
Overlooking the time period in calculations
Misinterpreting word problems leading to wrong setups
Neglecting to convert percentages into decimals when necessary
FAQs
Question: What is the formula for calculating Simple Interest?Answer: The formula for Simple Interest is SI = (Principal × Rate × Time) / 100.
Question: How can I apply Simple Interest in real-life situations?Answer: Simple Interest is commonly used in loans, savings accounts, and investments to calculate the interest earned or paid over time.
Now is the time to enhance your understanding of Simple Interest! Dive into our practice MCQs and test your knowledge to ensure you are well-prepared for your exams. Every question you solve brings you one step closer to mastering this essential topic!
Q. A loan of $5000 is taken at a simple interest rate of 9% per annum. How much interest will be paid after 2 years?
A.
$900
B.
$800
C.
$700
D.
$600
Show solution
Solution
Simple Interest = (5000 × 9 × 2) / 100 = $900.
Correct Answer:
A
— $900
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Q. A loan of $5000 is taken for 2 years at a simple interest rate of 8% per annum. What is the total amount to be paid back?
A.
$5400
B.
$5600
C.
$5800
D.
$6000
Show solution
Solution
Total Amount = Principal + Simple Interest = 5000 + (5000 × 8 × 2 / 100) = $5600.
Correct Answer:
B
— $5600
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Q. A loan of $5000 is taken for 2 years at a simple interest rate of 8% per annum. What is the total interest paid?
A.
$800
B.
$600
C.
$400
D.
$200
Show solution
Solution
Simple Interest = Principal × Rate × Time / 100 = 5000 × 8 × 2 / 100 = $800
Correct Answer:
A
— $800
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Q. A loan of $5000 is taken for 2 years at a simple interest rate of 8%. What will be the total amount to be paid back?
A.
$5400
B.
$5600
C.
$5800
D.
$6000
Show solution
Solution
Total Amount = Principal + Simple Interest = 5000 + (5000 × 8 × 2 / 100) = $5400.
Correct Answer:
B
— $5600
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Q. A loan of $5000 is taken for 3 years at a simple interest rate of 9%. What will be the total amount to be paid back?
A.
$6000
B.
$6500
C.
$7000
D.
$7200
Show solution
Solution
Simple Interest = (5000 * 9 * 3) / 100 = $1350. Total Amount = Principal + Interest = 5000 + 1350 = $6350.
Correct Answer:
B
— $6500
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Q. A loan of $5000 is taken for 4 years at a simple interest rate of 7%. What will be the total interest paid?
A.
$1400
B.
$1500
C.
$1600
D.
$1700
Show solution
Solution
Simple Interest = 5000 × 7 × 4 / 100 = $1400.
Correct Answer:
A
— $1400
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Q. A loan of $5000 is taken for 4 years at a simple interest rate of 8% per annum. What is the total interest paid?
A.
$1600
B.
$1800
C.
$2000
D.
$2200
Show solution
Solution
Simple Interest = 5000 × 8 × 4 / 100 = $1600.
Correct Answer:
A
— $1600
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Q. A person invests $2500 at a simple interest rate of 10% per annum. How much interest will he earn in 6 years?
A.
$150
B.
$200
C.
$300
D.
$400
Show solution
Solution
Simple Interest = 2500 × 10 × 6 / 100 = $1500.
Correct Answer:
C
— $300
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Q. A person invests $5000 at a simple interest rate of 8% per annum. How much interest will he earn in 2.5 years?
A.
$1000
B.
$800
C.
$600
D.
$500
Show solution
Solution
Simple Interest = 5000 × 8 × 2.5 / 100 = $1000.
Correct Answer:
C
— $600
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Q. A sum of $1500 is invested at a simple interest rate of 4% per annum. How much interest will be earned in 5 years?
A.
$200
B.
$300
C.
$250
D.
$150
Show solution
Solution
Simple Interest = (1500 * 4 * 5) / 100 = $300.
Correct Answer:
B
— $300
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Q. A sum of money doubles itself in 10 years at a simple interest rate. What is the rate of interest?
A.
5%
B.
10%
C.
15%
D.
20%
Show solution
Solution
If the amount doubles, then Simple Interest = Principal. Rate = (100 × SI) / (P × T) = (100 × P) / (P × 10) = 10%.
Correct Answer:
B
— 10%
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Q. A sum of money doubles itself in 10 years at simple interest. What is the rate of interest?
A.
5%
B.
10%
C.
15%
D.
20%
Show solution
Solution
If the amount doubles, Interest = Principal. Rate = (Interest * 100) / (Principal * Time) = (Principal * 100) / (Principal * 10) = 10%.
Correct Answer:
A
— 5%
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Q. If a person borrows $1000 at a simple interest rate of 6% per annum, how much interest will he pay after 4 years?
A.
$240
B.
$260
C.
$280
D.
$300
Show solution
Solution
Simple Interest = 1000 × 6 × 4 / 100 = $240.
Correct Answer:
C
— $280
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Q. If a person earns $120 as simple interest on a principal of $800 in 2 years, what is the rate of interest?
A.
5%
B.
6%
C.
7.5%
D.
8%
Show solution
Solution
Rate = (Simple Interest × 100) / (Principal × Time) = (120 × 100) / (800 × 2) = 7.5%.
Correct Answer:
B
— 6%
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Q. If a person earns $120 as simple interest on a principal of $800 in 2 years, what is the rate of interest per annum?
A.
5%
B.
6%
C.
7.5%
D.
8%
Show solution
Solution
Rate = (Simple Interest × 100) / (Principal × Time) = (120 × 100) / (800 × 2) = 7.5%.
Correct Answer:
B
— 6%
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Q. If a person earns $180 as simple interest on a principal of $1200 in 3 years, what is the rate of interest?
Show solution
Solution
Rate = (Interest * 100) / (Principal * Time) = (180 * 100) / (1200 * 3) = 5%.
Correct Answer:
B
— 5%
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Q. If a person invests $2500 at a simple interest rate of 12% per annum, how much interest will he earn in 4 years?
A.
$1200
B.
$1000
C.
$800
D.
$600
Show solution
Solution
Simple Interest = 2500 × 12 × 4 / 100 = $1200
Correct Answer:
B
— $1000
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Q. If a person invests $2500 at a simple interest rate of 3% per annum, how much interest will he earn in 4 years?
A.
$300
B.
$200
C.
$150
D.
$100
Show solution
Solution
Simple Interest = Principal × Rate × Time / 100 = 2500 × 3 × 4 / 100 = $300
Correct Answer:
B
— $200
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Q. If a person invests $2500 at a simple interest rate of 7% per annum, how much interest will he earn in 6 years?
A.
$700
B.
$800
C.
$900
D.
$1000
Show solution
Solution
Simple Interest = 2500 × 7 × 6 / 100 = $1050.
Correct Answer:
B
— $800
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Q. If a person invests $2500 at a simple interest rate of 8% per annum, how much interest will he earn in 6 years?
A.
$1200
B.
$1000
C.
$800
D.
$600
Show solution
Solution
Simple Interest = 2500 × 8 × 6 / 100 = $1200.
Correct Answer:
B
— $1000
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Q. If a person invests $3000 at a simple interest rate of 7% per annum, how much interest will he earn in 6 years?
A.
$1260
B.
$1440
C.
$1500
D.
$1800
Show solution
Solution
Simple Interest = (3000 × 7 × 6) / 100 = $1260.
Correct Answer:
A
— $1260
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Q. If a person invests $800 at a simple interest rate of 7% per annum, how much interest will he earn in 2 years?
A.
$100
B.
$112
C.
$120
D.
$140
Show solution
Solution
Simple Interest = (800 * 7 * 2) / 100 = $112.
Correct Answer:
B
— $112
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Q. If a sum of $1200 is invested at a simple interest rate of 9% per annum, what will be the total amount after 3 years?
A.
$1400
B.
$1450
C.
$1500
D.
$1550
Show solution
Solution
Simple Interest = 1200 × 9 × 3 / 100 = $324. Total Amount = 1200 + 324 = $1524.
Correct Answer:
B
— $1450
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Q. If the principal amount is $2000 and the rate of interest is 5% per annum, what will be the simple interest for 3 years?
A.
$300
B.
$400
C.
$500
D.
$600
Show solution
Solution
Simple Interest = (Principal * Rate * Time) / 100 = (2000 * 5 * 3) / 100 = $300.
Correct Answer:
A
— $300
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Q. If the simple interest on a certain amount for 4 years is $200 at a rate of 5% per annum, what is the amount?
A.
$800
B.
$1000
C.
$1200
D.
$1500
Show solution
Solution
Principal = (Simple Interest × 100) / (Rate × Time) = (200 × 100) / (5 × 4) = $1000.
Correct Answer:
B
— $1000
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Q. If the simple interest on a sum of money for 3 years is $150 at a rate of 5% per annum, what is the principal amount?
A.
$1000
B.
$900
C.
$800
D.
$750
Show solution
Solution
Principal = (Simple Interest × 100) / (Rate × Time) = (150 × 100) / (5 × 3) = $1000.
Correct Answer:
A
— $1000
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Q. If the simple interest on a sum of money for 3 years is $180 at a rate of 3% per annum, what is the principal amount?
A.
$1200
B.
$1500
C.
$1800
D.
$2000
Show solution
Solution
Principal = (Simple Interest × 100) / (Rate × Time) = (180 × 100) / (3 × 3) = $2000.
Correct Answer:
C
— $1800
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Q. If the simple interest on a sum of money for 3 years is $180 at a rate of 5% per annum, what is the principal amount?
A.
$1000
B.
$1200
C.
$1500
D.
$1800
Show solution
Solution
SI = P × R × T / 100. 180 = P × 5 × 3 / 100. P = (180 × 100) / (5 × 3) = $1200.
Correct Answer:
B
— $1200
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Q. If the simple interest on a sum of money is $240 after 4 years at a rate of 6% per annum, what is the principal amount?
A.
$1000
B.
$1200
C.
$1500
D.
$1600
Show solution
Solution
Principal = (Interest × 100) / (Rate × Time) = (240 × 100) / (6 × 4) = $1000.
Correct Answer:
B
— $1200
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Q. If the simple interest on a sum of money is $240 after 4 years at a rate of 6% per annum, what is the principal?
A.
$1000
B.
$1200
C.
$1500
D.
$1600
Show solution
Solution
Principal = (Interest * 100) / (Rate * Time) = (240 * 100) / (6 * 4) = $1000.
Correct Answer:
B
— $1200
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