5.Simple and Compound Interest

Question 1

What is the formula for simple interest?

Answer 1

Simple Interest = (Principal * Rate * Time) / 100

Question 2

What is the formula for compound interest?

Answer 2

Compound Interest = Principal * [(1 + Rate/100)^Time - 1]

Question 3

What is the difference between simple interest and compound interest?

Answer 3

Simple interest is calculated only on the principal amount, while compound interest is calculated on both the principal and the accumulated interest.

Question 4

What is the formula for the amount (total) in simple interest?

Answer 4

Amount = Principal + Simple Interest

Question 5

What is the formula for the amount (total) in compound interest?

Answer 5

Amount = Principal + Compound Interest

Question 6

What is the formula for calculating the principal amount in simple interest?

Answer 6

Principal = (Simple Interest * 100) / (Rate * Time)

Question 7

What is the formula for calculating the principal amount in compound interest?

Answer 7

Principal = (Compound Interest * 100) / [(1 + Rate/100)^Time - 1]

Question 8

What is the formula for calculating the rate of interest in simple interest?

Answer 8

Rate = (Simple Interest * 100) / (Principal * Time)

Question 9

Doubling of money

Answer 9

Rule of 72 i.e. Rate * Time = 72 (approx.)

Question 10

Tripling of money

Answer 10

Rule of 114 i.e. Rate * Time = 114 (approx.)