Compound Interest – Data Sufficiency 1

Directions to Solve

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 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

Correct Answer: D. Both I and II are not sufficient to answer

Answer Explanation:

the rate of compound interest is

2. What will be the 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

Correct Answer: C. Either I or II alone sufficient to answer

Answer Explanation:

the compounded amount will be

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

Correct Answer: E. Both I and II are necessary to answer

Answer Explanation:

the difference between the simple and the compound interest earned on it at the same rate

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