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Interest Rate Math Tricks Banking

The document provides shortcut tricks for solving interest rate problems, including methods for calculating simple and compound interest. It includes formulas for determining time, principal, rate, and differences between compound and simple interest, along with practice problems and their solutions. Key examples demonstrate how to apply these tricks effectively for banking exams.

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Sadatur Rahman
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33 views2 pages

Interest Rate Math Tricks Banking

The document provides shortcut tricks for solving interest rate problems, including methods for calculating simple and compound interest. It includes formulas for determining time, principal, rate, and differences between compound and simple interest, along with practice problems and their solutions. Key examples demonstrate how to apply these tricks effectively for banking exams.

Uploaded by

Sadatur Rahman
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Interest Rate Math Tricks & Practice - Banking Exams

Shortcut Tricks for Interest Rate Problems

1. Interest Doubles Trick (Simple Interest):

Time = 100 / Rate

2. CI - SI (for 2 years):

Difference = (P × R²) / 100²

3. Principal from SI:

P = (SI × 100) / (R × T)

4. Rate from SI:

R = (SI × 100) / (P × T)

5. Compound Interest Shortcut for 2 years:

CI = SI + (SI_1 × R / 100)

6. CI (Half-yearly for 1.5 years):

CI = P × (1 + R/(2×100)) ^ (2×T)

Practice Problems with Answers

1. At what rate will Rs.1000 double in 8 years?

Solution: R = 100 / T = 100 / 8 = 12.5%

2. Find the CI and SI on Rs.2000 at 10% for 2 years. Also find the difference.

SI = (2000×10×2)/100 = Rs.400

CI = SI + (SI_1×R)/100 = 200 + (200×10)/100 = 200 + 20 = Rs.420

Difference = Rs.20
Interest Rate Math Tricks & Practice - Banking Exams

3. Find the principal if SI = Rs.600, R = 12%, T = 2 years.

P = (600×100)/(12×2) = Rs.2500

4. Find the rate if SI = Rs.240, P = Rs.1200, T = 2 years.

R = (240×100)/(1200×2) = 10%

5. CI for Rs.4000 at 10% per annum for 1.5 years (compounded half-yearly)?

Half-yearly rate = 5%, periods = 3

CI = 4000×(1+0.05)^3 = 4000×1.157625 = Rs.4630.5

CI = Rs.630.5

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