Simple and Compound Interest

Simple and Compound Interest

By Mr Matheus Andrade

Multiple Choice

4000 dollars is deposited into a bank account and the annual simple interest rate is 8%. How much is the interest after 1 year?

• $ 320

• $ 400

• $ 4400

• $ 4320

Multiple Choice

4000 dollars is deposited into a bank account and the annual simple interest rate is 8%. How much is the interest after 4 year?

• $ 1442

• $ 1280

• $ 5280

• $ 5442

Multiple Choice

Compute the interest if the principal is 1000 dollars at a rate of simple interest of 2% for 10 years.

• $ 20

• $ 200

• $ 2000

• $ 2

Multiple Choice

A company's balance sheet shows that a certain capital was invested at a rate of 30% per year during 8 months, yielding simple interest in the amount of $192.00. The principal applied was

• $ 288

• $ 880

• $ 960

• $ 2880

Multiple Choice

4000 dollars is deposited into a bank account and the annual simple interest rate is 8%. How much is the TOTAL AMOUNT after 4 year?

• $ 320

• $ 1280

• $ 4320

• $ 5280

Multiple Choice

Miguel's father borrowed $1,000 from the bank and the simple interest rate was 5%. What would be the total amount if he requested a loan to be paid back in 6 years?

• $ 300

• $ 1600

• $ 600

• $ 1300

Multiple Choice

How long must a principal be kept in a simple interest rate investment at 2% p.m. for it to generate an amount that is the double of the invested principal?

• 3 years and 4 months

• 3 years and 6 months

• 3 years and 9 months

• 4 years

• 4 years and 2 months

Multiple Choice

4000 dollars is deposited into a bank account and the annual COMPOUND interest rate is 10%. How much is the total amount after 2 year?

• $ 1442

• $ 4800

• $ 4840

• $ 5442

Multiple Choice

Compute the interest if the principal is 1000 dollars at a rate of compound interest of 20% for 3 years.

• $ 1728

• $ 728

• $ 2000

• $ 228

Multiple Choice

The count of a certain breed of bacteria was found to increase at the rate of 2% per hour. Find the bacteria at the end of 2 hours if the count was initially 600000.

• 804040

• 624240

• 726240

• 620000

Multiple Choice

The difference between simple interest and compound interest is that

• Simple interest is easier to compute

• Simple interest yields a lot money

• Simple interest is interest computed on the original principal only

• Compound interest keeps computing interest

Multiple Choice

Another difference between simple interest and compound interest is that

• bank uses compound interest when the money invested is substantial

• bank always use simple interest

• simple interest will yield less money, but the computation is easier with compound interest

• compound interest will yield more money

Multiple Choice

Credit card companies usually uses simple interest

• TRUE

• FALSE

Multiple Choice

You invest 1000 dollars for 3 years with a 10% of interest rate per annum. The simple interest is equal to

• $ 300

• $ 200

• $ 400

• $ 350

Multiple Choice

You invest 1000 dollars for 3 years with a 10% of interest rate compounded at the end of each year. Compound interest is equal to

• $ 341

• $ 321

• $ 331

• $ 351