Simple Interest Practice Questions with Detailed Solutions – Level 3

Simple Interest Level 3 Practice Quiz: Instalments, Changing Rates and CI

This is the Level 3 Simple Interest practice quiz in the Quant Arithmetic set on Aptitude360, built around the harder problems in the topic. It covers equal annual instalments, rates that change over time, sums split across different rates and the link between simple and compound interest. A worked solution is given for every question.

Topics in this Simple Interest Level 3 set

• Equal annual instalments that clear a debt due at a future date
• Loans where the rate changes across different periods
• Dividing a sum so that the amounts on each part become equal after different years
• Capital spread across several rates, and the effect of interchanging two rates
• Time for a sum to become a given multiple of itself
• Difference between compound and simple interest on the same sum
• Effective rate when interest is deducted upfront or compounded half-yearly, and gain from borrowing at one rate and lending at another

Key simple interest formulas

• Simple interest: \( SI=\dfrac{P\times R\times T}{100} \)
• Amount: \( A=P\left(1+\dfrac{RT}{100}\right) \)
• Sum becomes \( k \) times itself: \( R\times T=100(k-1) \)
• CI minus SI for two years: \( P\left(\dfrac{R}{100}\right)^{2} \)
• Debt \( A \) cleared by \( n \) instalments \( x \): \( A=nx+\dfrac{xR}{100}\times\dfrac{n(n-1)}{2} \)

Preparation tips for harder interest problems

• For changing rates, add the rate multiplied by time for each period before applying the formula
• For equal amounts on split sums, set up each part's amount as principal multiplied by the growth factor and compare
• Remember that the first year's compound and simple interest are always equal, so the gap starts in the second year

Who should practise this level

Students in Chandigarh and elsewhere who are comfortable with the basic simple interest formula and want multi-step arithmetic practice before moving to mixed quant sets.