Class 9 Compound Interest Mock Test (ICSE)

Topics in Compound Interest

• Compound interest year by year
• Interest compounded half-yearly
• Finding principal or rate step by step
• Amount using formula
• Compound interest when rate varies each year
• Growth and depreciation
• Finding rate, time or principal

Compound Interest practice questions with answers

1. Q1Multiple choice·1 mark
   If the compound interest on a certain sum for the first year is ₹ $400$ and for the second year is ₹ $440$, the rate of interest per annum is:

   1. (a)$10\%$
   2. (b)$12\%$
   3. (c)$8\%$
   4. (d)$5\%$
   Show answer and step marks

   1. Correct option: (a) $10\%$. The extra interest in the second year (₹ $440 -$ ₹ $400 =$ ₹ $40$) is the interest on the first year's interest of ₹ $400$ for $1$ year. Thus, rate = $\frac{40 \times 100}{400 \times 1} = 10\%$.+1

   Answer: (a)
2. Q2Multiple choice·1 mark
   The compound interest on ₹ $4000$ at $10\%$ per annum for $2$ years, compounded annually, is:

   1. (a)₹ $880$
   2. (b)₹ $800$
   3. (c)₹ $840$
   4. (d)₹ $820$
   Show answer and step marks

   1. Correct option: (c) ₹ $840$. Interest for 1st year = $\frac{4000 \times 10 \times 1}{100} =$ ₹ $400$. Amount after 1st year = ₹ $4000 +$ ₹ $400 =$ ₹ $4400$. Interest for 2nd year = $\frac{4400 \times 10 \times 1}{100} =$ ₹ $440$. Total compound interest = ₹ $400 +$ ₹ $440 =$ ₹ $840$.+1

   Answer: (c)
3. Q3Multiple choice·1 mark
   A sum of ₹ $5000$ is borrowed at $20\%$ per annum compound interest. If the interest is compounded half-yearly, the amount to be paid after $6$ months is:

   1. (a)₹ $5400$
   2. (b)₹ $5500$
   3. (c)₹ $5600$
   4. (d)₹ $6000$
   Show answer and step marks

   1. Correct option: (b) ₹ $5500$. For $6$ months compounded half-yearly, time is $1$ half-year and rate is $\frac{20\%}{2} = 10\%$ per half-year. Interest = $\frac{5000 \times 10 \times 1}{100} =$ ₹ $500$. Amount = ₹ $5000 +$ ₹ $500 =$ ₹ $5500$.+1

   Answer: (b)
4. Q4Multiple choice·1 mark
   Find the compound interest on ₹ $6000$ for $1$ year at $10\%$ per annum compounded half-yearly.

   1. (a)₹ $615.15$
   2. (b)₹ $630$
   3. (c)₹ $615$
   4. (d)₹ $600$
   Show answer and step marks

   1. Correct option: (c) ₹ $615$. Interest for the first half-year = $\frac{6000 \times 5 \times 1}{100} =$ ₹ $300$, making the amount ₹ $6300$. Interest for the second half-year = $\frac{6300 \times 5 \times 1}{100} =$ ₹ $315$. Total compound interest = $300 + 315 =$ ₹ $615$.+1

   Answer: (c)
5. Q5Long answer·4 marks
   Calculate the compound interest on ₹ $12500$ for $2$ years at $8\%$ per annum, compounded yearly, by calculating the interest year by year without using the direct formula. Also, find the total amount at the end of $2$ years.
   Show answer and step marks

   1. Interest for the first year = $\frac{12500 \times 8 \times 1}{100} = \text{₹ } 1000$+1
   2. Amount at the end of the first year (Principal for the second year) = ₹ $12500 + \text{₹ } 1000 = \text{₹ } 13500$+0.5
   3. Interest for the second year = $\frac{13500 \times 8 \times 1}{100} = \text{₹ } 1080$+1
   4. Total Compound Interest = $\text{₹ } 1000 + \text{₹ } 1080 = \text{₹ } 2080$+1
   5. Total Amount = $\text{₹ } 13500 + \text{₹ } 1080 = \text{₹ } 14580$+0.5

   Answer: Compound Interest = ₹ $2080$, Total Amount = ₹ $14580$

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