Quiz: Compound Interest Practice Questions (set 1)

This quiz consists of questions designed to test your understanding of compound interest concepts, as explained in the video on this page. Since these questions involve lots of calculations, feel free to use a calculator. However, please avoid using any other external resources to assist in solving the questions. If your answers are incorrect, you can retake the quiz and attempt to get them all correct. The primary goal of this quiz is to help students master the concept of compound interest. The difficulty level ranges from basic to medium. If you notice any errors in the questions or answers, please leave a comment. Enjoy the quiz!

Different currencies are used in the questions. Do not be confused by the symbols if you are seeing them for the first time—they are simply currency symbols.
$: US dollar
₹: Indian rupee

1. 
A sum of ₹5,000 is invested at an annual interest rate of 5% compounded annually. What will be the amount after 2 years?

2. 
Find the compound interest on \$8,000 at an annual interest rate of 10% for 3 years, compounded annually.

3. 
If \$1,200 becomes \$1,320 in one year at a certain compound interest rate, find the annual interest rate.

4. 
The population of a town increases by 4% every year. If the current population is 20,000, what will the population be after 3 years?

5. 
The number of cells in a lab experiment grows by 20% every day. If there are 500 cells on Day 1, how many will there be at the end of Day 7 (give the closest answer)?

6. 
The value of a house appreciates by 6% per year. If the current value of the house is ₹5,000,000, what will it be worth in 5 years?

7. 
A city’s water consumption decreases by 3% annually. If the current consumption is 1,000,000 liters per year, what will it be after 5 years?

8. 
The population of a town is increasing at a rate of 5% annually. If the current population is 10,000, how many years will it take for the population to double (give the closest answer)?

9. 
The population of a species of fish in a lake triples every 2 years. If the initial population is 2,000 fish, what will the population be after 6 years?

10. 
A radioactive substance decays by half every 3 years. If the initial amount is 1,000 grams, how much of the substance will remain after 9 years?

Leave a Reply

Your email address will not be published. Required fields are marked *