Quantitative Aptitude – Simple & Compound Interest
Simple and Compound Interest are important topics in bank exams. These concepts are used in financial calculations and are frequently asked in exams.
Simple Interest (SI)
SI = (P × R × T) / 100
- P = Principal
- R = Rate of Interest
- T = Time
Amount = Principal + Interest
---Compound Interest (CI)
Amount = P (1 + R/100)T
CI = Amount - Principal
---Difference Between SI and CI
- SI is calculated on original principal
- CI is calculated on principal + previous interest
- CI grows faster than SI
Shortcut Tricks
1. For 2 Years
Difference between CI and SI = (P × R²) / 10000
2. For 3 Years
Difference = P × R³ / 100000 (approx concept)
3. Growth Concept
If rate is 10% → multiply by 1.1 If rate is 20% → multiply by 1.2
Practice Questions
Q1. Find SI on 1000 at 10% for 2 years
Answer: 200
Q2. Find CI on 1000 at 10% for 2 years
Answer: 210
Q3. Find amount on 2000 at 5% for 2 years (CI)
Answer: 2205
Q4. Difference between SI and CI for 1000 at 10% for 2 years
Answer: 10
Speed Strategy
- Use direct formulas
- Memorize basic values
- Apply growth factor method
- Avoid lengthy calculations
Practice Task
1. Find SI on 1500 at 8% for 2 years
2. Find CI on 1000 at 10% for 3 years
3. Find difference between SI and CI for 2000 at 5% for 2 years
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