Simple & Compound Interest (Cambridge International IGCSE Mathematics): Exam Questions

Ethan invests $6400 at a rate of 2.6% per year simple interest.

Calculate the total value of his investment at the end of 3 years.

$ ................................................

Jamie invests $12000 at a rate of 5% per year compound interest.

Calculate the value of his investment at the end of 3 years.

$ ..............................................

Jan invests $800 at a rate of 3% per year simple interest.

Calculate the value of her investment at the end of 4 years.

$ ....................................

Sam invests $4500 into a savings account which pays 3.5% compound interest each year.

Find the total amount in the account after 6 years.

Cody is aiming to save $2000 in total.

They invest $1750 in a savings account which pays 6.5% compound interest each year.

How many years will it take for the balance in the account to reach at least $2000?

Trina invests $16000 at a rate of 5% per year compound interest.

Work out the value of her investment at the end of 4 years.

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Gino invests $6000 for 5 years at a rate of 1.2% per year compound interest.

Calculate the value of his investment at the end of the 5 years. Give your answer correct to the nearest dollar.

$ .................................................

Lucia invests $5000 at a rate of 4.5% per year compound interest.

Calculate the value of her investment at the end of 7 years.

$ ..................................................

Ella invests $4000 for 3 years at a rate of 1.2% per year compound interest.

Calculate the value of her investment at the end of the 3 years.

$...................................................

Javier invests $750 for 3 years at a rate of 1.8% per year compound interest.

Calculate the value of his investment at the end of the 3 years.

$ ...................................................

Hawa invests $750 at a rate of 3.5% per year compound interest.

Calculate the value of his investment at the end of 3 years.

$ ..............................

Geri and Tom start a business together.

In the first year, the business makes a profit of $127 600. Geri receives $\frac{3}{8}$ of the profit. Tom receives $22 330 of the profit. The rest of the profit is put into a bank account.

(i) Calculate how much money Geri receives.

$ ............................................... [1]

(ii) Calculate the amount put into the bank account as a percentage of the profit.

............................................% [2]

(iii) Tom invests his $22 330 at a rate of 3.2% per year compound interest. Calculate the value of this investment at the end of 5 years.

$ ............................................... [2]

$12000 is invested at a rate of n% per year simple interest. At the end of 3 years the value of the investment is $12900.

Find the value of $n$.

$n$ = .................................

Sonia wants to invest $5000 for 6 years.

Bank A pays compound interest at a rate of 3.5% per year. Bank B increases the $5000 by 22% at the end of 6 years.

Which bank will give Sonia the most money at the end of 6 years and by how much? You must show all your working.

Riya invests $30000 at a rate of 2.5% per year compound interest.

Calculate the value of her investment at the end of 7 years. Give your answer correct to the nearest dollar.

$ .................................................

Six years ago a farmer invested $3750 at a rate of 4% per year compound interest.

i) Calculate the total value of his investment after the 6 years. Give your answer correct to the nearest dollar.

$ ............................................... [3]

ii) The farmer wants to spend his investment on buying goats. Goats cost $126 each.

Work out the maximum number of goats he can buy and the amount of money left over.

Number of goats .............................................. Amount of money left over $ ............................................... [4]

The farmer grows carrots. In 2018 the selling price for carrots was $96 per tonne. In 2019 this selling price increased by 18%.

Work out the increase in the selling price from 2018 to 2019.

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Paula invests $600 at a rate of$r$% per year simple interest.

At the end of 10 years, the total interest earned is $90.

Find the value of $r.$

$r$ =........................................

$8400 is invested for 2 years at a rate of 3.5% per year compound interest. Work out the total amount of interest earned by the end of the 2 years.

$....................................................

Harry invests $800 for 2 years at a rate of 3% per year compound interest.

Calculate the amount of interest he receives at the end of the 2 years.

$ ...........................

Tomas borrows $5000 for 3 years at a rate of 2.5% per year compound interest. He pays back the whole amount, with interest, at the end of 3 years.

Calculate the total amount of money he pays back at the end of the 3 years.

$ ..............................

Kim invests £13000 at a rate of 10% per year simple interest.

Calculate the total value of his investment after five years.

Kim finds another option to invest his £13000.

This second option has a rate of 6% compounded annually.

Find the value of his investment after four years.

Kim is looking to invest a £1000 and is choosing between two options.

Option A is a compound interest rate of 10%.

Option B is a simple interest rate of 12%

The two options are shown in the table below.

Option B gives a greater investment than Option A after $k$ years.

Find the smallest integer value of $k$.

Explain why the compound interest rate eventually always returns a greater amount than simple interest?