Compound Interest Questions for SBI PO 2026, Free Practice Quiz

Compound Interest Questions for SBI PO require candidates to calculate interest on both the principal and previously accumulated interest. Questions may involve annual, half-yearly or quarterly compounding.

Candidates should understand the amount formula and learn shortcut methods for the difference between compound and simple interest.

Compound Interest Practice Questions : Free Quiz

Compound Interest is a key arithmetic topic in the SBI PO exam. It involves calculating interest on the original principal as well as the interest accumulated over previous periods. Compound Interest questions assess a candidate’s conceptual clarity, calculation speed, and numerical accuracy. Practising topic-wise quizzes regularly helps candidates strengthen weak areas, reduce calculation errors, and solve questions faster in the actual exam.

Compound Interest Formula

Amount = P(1 + R/100)ᵀ

Compound Interest = Amount − Principal

For half-yearly compounding:

• Rate becomes R/2
• Time periods become 2T

Compound Interest Shortcuts

• For two years: CI − SI = P(R/100)²
• Growth questions use the amount formula.
• Depreciation uses: P(1 − R/100)ᵀ
• For different annual rates, multiply separate growth factors.

Common Mistakes

• Using simple interest calculations
• Forgetting to change the rate for half-yearly compounding
• Subtracting the principal when only the amount is required
• Applying the rate to the original principal every year
• Ignoring different rates for different years

FAQs

What is the main difference between SI and CI?

Simple interest is calculated only on the principal. Compound interest is calculated on the principal and accumulated interest.

How is half-yearly compound interest calculated?

Divide the annual rate by two and double the number of years.

Are growth and depreciation questions based on CI?

Yes. Population growth, machine depreciation and investment growth use compound-change concepts.