Example 1
What is the simple interest on ₹16,500 at 8% per annum for 6 years?
Answer: B) ₹7,920
SI = P × R × T / 100 = 16,500 × 8 × 6 / 100 = ₹7,920.
Simple Interest questions for competitive exams: rules, worked examples and practice
Simple interest is earned only on the original principal, the same amount every year.
Key rules and formulas
- SI = P × R × T ÷ 100.
- Amount = P + SI.
- Time must be in years: 6 months = 0.5 years.
- If a sum doubles in T years, R = 100 ÷ T.
Common traps
- Leaving time in months.
- Confusing amount with interest.
Where Simple Interest is asked
- IBPS Clerk Prelims (Numerical Ability)
- IBPS PO Prelims (Quantitative Aptitude)
- RRB Group D (Mathematics)
- RRB NTPC CBT 1 (Mathematics)
- SBI Clerk Prelims (Numerical Ability)
- SBI PO Prelims (Quantitative Aptitude)
- SSC CGL Tier 1 (Quantitative Aptitude)
- SSC CGL Tier 2 (Mathematical Abilities)
- SSC CHSL Tier 1 (Quantitative Aptitude)
Worked examples
Example 2
What is the simple interest on ₹7,000 at 8% per annum for 3 years?
Answer: B) ₹1,680
SI = P × R × T / 100 = 7,000 × 8 × 3 / 100 = ₹1,680.
Example 3
What is the simple interest on ₹12,000 at 6% per annum for 5 years?
Answer: D) ₹3,600
SI = P × R × T / 100 = 12,000 × 6 × 5 / 100 = ₹3,600.
Frequently asked questions
What is Simple Interest in competitive exams?
Simple interest is earned only on the original principal, the same amount every year.
Which exams ask Simple Interest questions?
On MockBazaar, Simple Interest questions appear in IBPS Clerk Prelims, IBPS PO Prelims, RRB Group D, RRB NTPC CBT 1, SBI Clerk Prelims, SBI PO Prelims, SSC CGL Tier 1, SSC CGL Tier 2, SSC CHSL Tier 1.
What is the most common mistake in Simple Interest?
Leaving time in months.