CAT Simple Interest Questions With Answers PDF; Practice Test and Preparation Guide

Question 1

A sum of Rs. 12,000 is invested at a simple interest rate of 8% per annum for 3 years. What will be the total amount received at the end of 3 years?

(a) Rs. 14,400

(b) Rs. 14,880

(c) Rs. 15,120

(d) Rs. 15,240

Answer: (b) Rs. 14,880

Question 2

A certain sum amounts to Rs. 13,200 in 4 years and Rs. 15,600 in 8 years at a certain rate of simple interest. What is the principal amount?

(a) Rs. 9,600

(b) Rs. 10,000

(c) Rs. 10,800

(d) Rs. 11,200

Answer: (b) Rs. 10,000

Question 3

Rahul invests Rs. 20,000 in two schemes. He invests Rs. x at 6% simple interest and the remaining amount at 9% simple interest. If his total annual interest is Rs. 1,500, find x.

(a) Rs. 8,000

(b) Rs. 10,000

(c) Rs. 12,000

(d) Rs. 15,000

Answer: (b) Rs. 10,000

Question 4

A person borrows Rs. 25,000 at a simple interest rate of 12% per annum. If he repays the loan after 2 years and 6 months, how much does he pay in total?

(a) Rs. 31,500

(b) Rs. 32,000

(c) Rs. 32,500

(d) Rs. 33,000

Answer: (c) Rs. 32,500

Question 5

The simple interest earned on a certain principal at 10% per annum for 5 years is Rs. 3,000. What will be the simple interest on the same principal at 12% per annum for 4 years?

(a) Rs. 3,200

(b) Rs. 3,400

(c) Rs. 3,600

(d) Rs. 3,800

Answer: (c) Rs. 3,600

Question 6

A person invests a certain amount at 8% simple interest for 5 years. If the interest earned is Rs. 4,800, find the principal amount.

(a) Rs. 10,000

(b) Rs. 11,000

(c) Rs. 12,000

(d) Rs. 15,000

Answer: (c) Rs. 12,000

Question 7

A sum of Rs. 15,000 is invested at a certain rate of simple interest. The amount becomes Rs. 18,600 after 4 years. What is the rate of interest per annum?

(a) 5%

(b) 6%

(c) 7%

(d) 8%

Answer: (b) 6%

Question 8

An amount of Rs. 10,000 is invested at simple interest. The interest earned in 6 years is equal to 60% of the principal. What is the annual rate of interest?

(a) 8%

(b) 9%

(c) 10%

(d) 12%

Answer: (c) 10%

CAT Simple Interest questions can be based on different applications of the same basic concept. Candidates should practise direct as well as mixed questions.

• Basic concept of Simple Interest
• Simple Interest formula: SI = (P × R × T) / 100
• Amount calculation: Amount = Principal + Simple Interest
• Finding Principal, Rate or Time
• Time period in years, months and days
• Different rates for different time periods
• Successive changes in principal or rate
• Comparison of Simple Interest
• Difference between SI and Amount
• Simple Interest on loans and investments
• Installment-based Simple Interest problems
• Word problems involving SI
• Simple Interest vs Compound Interest
• Mixed problems involving percentage and SI
• Short tricks and approximation-based questions

Candidates should remember the basic Simple Interest formula for CAT before starting practice. 

Simple Interest (SI) = (P × R × T)/100

Where:

• P = Principal amount
• R = Rate of interest per annum
• T = Time in years

The total amount is:

Amount = Principal + Simple Interest

Therefore:

A = P + (P × R × T)/100
For a time period given in months, convert it into years before applying the formula. For example, 6 months = 0.5 years and 9 months = 0.75 years.

Simple Interest questions can often be solved quickly. Candidates should avoid lengthy calculations when the values can be compared directly.

• Write SI formula before starting complex questions.
• Convert months into years immediately.
• Use ratios when same principal is involved.
• Calculate interest separately when money is divided into different investments.
• Look for percentage relationships before calculating actual principal.
• Use approximation only when question asks for nearest value.
• Check whether question is actually testing simple interest or a combination of SI and CI.