alleryFind the simple interest on 15,000 at 5% per annum for 2 years.
A750
B1,500
C1,575
D3,000
Answer & Solution
Correct answer: B. 1,500
1. Simple interest uses the formula P x R x T / 100.
2. Here P = 15000, R = 5 and T = 2.
3. Interest for one year is 5 per cent of 15000 = 750.
4. Over 2 years that is 750 x 2 = 1500.
5. 1575 would be the compound interest figure, so picking it means compounding where the question asked for simple interest.
_Source: syllabus Maths, Ch 7 'Comparing Quantities', S7.4 Compound Interest_
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