The savings-and-loan search that shows up in every personal-finance class. This page has 100 important questions and answers. Original explainer for daily search — not a government login or live tracker.
Simple interest is earned only on the original principal. Compound interest is earned on the principal plus interest already added — interest on interest. The more often it compounds (yearly, monthly, daily), the faster a balance can grow — or a debt can swell.
Credit cards and some student loans compound. Savings accounts and index funds use the same maths in the other direction. The Rule of 72 is a rough “years to double” shortcut: 72 ÷ annual % rate.
100 important questions. Quick 10 is a random set; Full set plays every question.
Your score
100 questions and answers
Each item is a 4-option MCQ. Open a question, tap A–D. Green is correct, red is wrong. Original explainers — not copied match reports.
1. The official source for “compound interest” (learn desk, item 24) is
Tap A, B, C or D.
Answer: A) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
2. The official source for “compound interest” (learn desk, item 25) is
Tap A, B, C or D.
Answer: B) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
3. The official source for “compound interest” (learn desk, item 26) is
Tap A, B, C or D.
Answer: D) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
4. The official source for “compound interest” (learn desk, item 27) is
Tap A, B, C or D.
Answer: C) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
5. The official source for “compound interest” (learn desk, item 28) is
Tap A, B, C or D.
Answer: B) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
6. The official source for “compound interest” (learn desk, item 29) is
Tap A, B, C or D.
Answer: A) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
7. The official source for “compound interest” (learn desk, item 30) is
Tap A, B, C or D.
Answer: B) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
8. The official source for “compound interest” (learn desk, item 31) is
Tap A, B, C or D.
Answer: A) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
9. The official source for “compound interest” (learn desk, item 32) is
Tap A, B, C or D.
Answer: C) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
10. The official source for “compound interest” (learn desk, item 33) is
Tap A, B, C or D.
Answer: D) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
11. The official source for “compound interest” (learn desk, item 34) is
Tap A, B, C or D.
Answer: C) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
12. The official source for “compound interest” (learn desk, item 35) is
Tap A, B, C or D.
Answer: D) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
13. The official source for “compound interest” (learn desk, item 36) is
Tap A, B, C or D.
Answer: B) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
14. The official source for “compound interest” (learn desk, item 37) is
Tap A, B, C or D.
Answer: A) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
15. The official source for “compound interest” (learn desk, item 38) is
Tap A, B, C or D.
Answer: D) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
16. The official source for “compound interest” (learn desk, item 39) is
Tap A, B, C or D.
Answer: C) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
17. The official source for “compound interest” (learn desk, item 40) is
Tap A, B, C or D.
Answer: B) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
18. The official source for “compound interest” (learn desk, item 41) is
Tap A, B, C or D.
Answer: A) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
19. The official source for “compound interest” (learn desk, item 42) is
Tap A, B, C or D.
Answer: C) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
20. The official source for “compound interest” (learn desk, item 43) is
Tap A, B, C or D.
Answer: D) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
21. The official source for “compound interest” (learn desk, item 44) is
Tap A, B, C or D.
Answer: C) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
22. The official source for “compound interest” (learn desk, item 45) is
Tap A, B, C or D.
Answer: D) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
23. The official source for “compound interest” (learn desk, item 46) is
Tap A, B, C or D.
Answer: B) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
24. The official source for “compound interest” (learn desk, item 47) is
Tap A, B, C or D.
Answer: A) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
25. The official source for “compound interest” (learn desk, item 48) is
Tap A, B, C or D.
Answer: D) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
26. The official source for “compound interest” (learn desk, item 49) is
Tap A, B, C or D.
Answer: C) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
27. The official source for “compound interest” (learn desk, item 50) is
Tap A, B, C or D.
Answer: D) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
28. Compound interest is
Tap A, B, C or D.
Answer: D) interest on principal plus earlier interest
That is why time in the market matters.
29. Simple interest is calculated on
Tap A, B, C or D.
Answer: B) the original principal only
It grows in a straight line.
30. A = P(1 + r/n)^(nt) is
Tap A, B, C or D.
Answer: B) a standard compound-interest formula
P is principal, r is the annual rate.
31. The Rule of 72 says money at 8% doubles in about
Tap A, B, C or D.
Answer: A) 9 years
72 ÷ 8 = 9.
32. More frequent compounding, same APR, generally
Tap A, B, C or D.
Answer: B) grows a savings balance a bit faster
Read the APY, not only the APR.
33. Credit-card interest that compounds
Tap A, B, C or D.
Answer: A) can grow a unpaid balance quickly
Pay more than the minimum when you can.
34. Starting early helps because
Tap A, B, C or D.
Answer: A) time lets compounding work longer
Small regular amounts still add up.
35. Compound interest is not
Tap A, B, C or D.
Answer: C) the same as inflation, though both use percents
Inflation can eat real returns.
36. Principal means
Tap A, B, C or D.
Answer: A) the starting amount before interest is added
Interest is calculated on this, then on more if it compounds.
37. APR is the yearly rate stated; APY usually
Tap A, B, C or D.
Answer: D) includes the effect of compounding
Compare APY when shopping savings.
38. If interest compounds monthly rather than yearly, the same nominal rate
Tap A, B, C or D.
Answer: D) usually produces a slightly higher effective yield
Banks quote both figures for a reason.
39. A loan that compounds while you pay only a little
Tap A, B, C or D.
Answer: A) can see the balance stall or even grow
That is how card debt swells.
40. The Rule of 72 at 6% a year says doubling takes about
Tap A, B, C or D.
Answer: D) 12 years
72 divided by 6 is 12.
41. The Rule of 72 at 9% a year says doubling takes about
Tap A, B, C or D.
Answer: A) 8 years
72 divided by 9 is 8.
42. The Rule of 72 at 12% a year says doubling takes about
Tap A, B, C or D.
Answer: D) 6 years
It is a shortcut, not a bank contract.
43. Simple interest on 1000 at 10% for 3 years is
Tap A, B, C or D.
Answer: C) 300 of interest (100 a year)
Compound would add interest on the 100s too.
44. 1000 at 10% compounded yearly for 3 years becomes
Tap A, B, C or D.
Answer: B) 1331
1000 x 1.1 x 1.1 x 1.1 = 1331.
45. Effective annual rate (EAR) answers
Tap A, B, C or D.
Answer: A) what you actually earn or pay in a year after compounding
It lets you compare odd compounding schedules.
46. Continuous compounding is
Tap A, B, C or D.
Answer: A) the mathematical limit of compounding ever more often
The formula uses e to the power rt.
47. Inflation plus compound interest means
Tap A, B, C or D.
Answer: D) the real growth of savings can be much smaller than the nominal
A 5% APY with 5% inflation is about zero real.
48. Starting a regular transfer early helps because
Tap A, B, C or D.
Answer: C) more periods exist for interest to land on interest
Time is the hidden multiplier.
49. A higher rate for a short time can lose to
Tap A, B, C or D.
Answer: A) a modest rate left to compound for many years
Charts of long horizons make this obvious.
50. Compound frequency daily vs yearly, same APR, generally
Tap A, B, C or D.
Answer: A) daily wins by a small extra yield
Read the APY line.
51. Student loans that capitalise interest
Tap A, B, C or D.
Answer: B) add unpaid interest to the principal
Ask when capitalisation happens.
52. A sinking credit-card balance needs
Tap A, B, C or D.
Answer: A) payments above the interest being added
Minimums often barely cover interest.
53. Nominal rate without the compounding schedule is
Tap A, B, C or D.
Answer: A) incomplete for a fair comparison
Ask how often it compounds.
54. If you withdraw all interest each year, you have turned
Tap A, B, C or D.
Answer: C) compound interest back into simple on a flat principal
The pot stops growing by interest-on-interest.
55. Negative interest or large fees can
Tap A, B, C or D.
Answer: C) compound the wrong way and shrink a balance
Read the tariff.
56. A 72 / r shortcut fails badly when
Tap A, B, C or D.
Answer: C) rates are extreme or compounding is very frequent and you need precision
Use the real formula for contracts.
57. Present value is
Tap A, B, C or D.
Answer: A) today money equivalent of a future compounded sum
Discounting is compounding in reverse.
58. An annuity that compounds is
Tap A, B, C or D.
Answer: C) a stream of payments earning interest as they sit
Pensions and regular savers use this idea.
59. Doubling time shortens if you
Tap A, B, C or D.
Answer: D) raise the rate or compound more often
Or add fresh principal.
60. Credit cards often advertise a monthly rate that
Tap A, B, C or D.
Answer: B) compounds, so the yearly cost is higher than month x 12 in simple terms
The APR/EAR box is the honest comparison.
61. A savings APY of 4% does not
Tap A, B, C or D.
Answer: A) guarantee a 4% rise in real buying power
Inflation and tax sit in the middle.
62. Reinvested fund dividends are a form of
Tap A, B, C or D.
Answer: C) compounding if they buy more units
Spending the dividends stops that path.
63. The exponent nt in A = P(1+r/n)^(nt) is
Tap A, B, C or D.
Answer: D) how many compounding periods in t years
n is compounds per year; t is years.
64. If r is 0 in that formula, A equals
Tap A, B, C or D.
Answer: D) P
No rate, no growth from interest.
65. Compound interest on debt is why
Tap A, B, C or D.
Answer: D) waiting to repay can cost more than the original spend
Time works against the borrower.
66. A teaser rate that jumps later
Tap A, B, C or D.
Answer: C) can change the compounding path after the honeymoon
Read the revert rate.
67. Adding 100 a month is
Tap A, B, C or D.
Answer: D) new principal that will itself start compounding
Regular contributions dwarf a one-off for many people.
68. Comparing two pots, the winner is not always
Tap A, B, C or D.
Answer: D) the one with the prettier advertised headline rate
Fees compound too — against you.
69. A year of 10% then a year of 0% on the new balance
Tap A, B, C or D.
Answer: B) is not the same as 5% a year for two years
Order and compounding both matter.
70. Tax on interest each year can
Tap A, B, C or D.
Answer: C) slow compounding if you cannot shelter the account
Use legal wrappers if they exist where you live.
71. A balance that compounds quarterly four times at r/4
Tap A, B, C or D.
Answer: D) approximates the annual effective yield for that APR
That is what n = 4 means.
72. The opportunity cost of spending a windfall now is
Tap A, B, C or D.
Answer: C) the compounded sum you will not have later
That is why payday transfers help.
73. Compound growth assumes
Tap A, B, C or D.
Answer: A) you leave the interest invested (or unpaid, on a loan)
Withdrawals break the assumption.
74. A Rule of 70 or 69 is sometimes used because
Tap A, B, C or D.
Answer: D) it can fit continuous or frequent compounding a bit better
Classroom Rule of 72 is still the usual shortcut.
75. If two friends save the same monthly amount, the one who starts 10 years earlier
Tap A, B, C or D.
Answer: D) usually ends far ahead even at the same rate
The extra years are extra compounds.
76. Interest-on-interest is another name for
Tap A, B, C or D.
Answer: A) compound interest
That is the whole idea.
77. A compound-interest question in exams often hides
Tap A, B, C or D.
Answer: C) whether the rate is per year and how many times it compounds
Underline n and t first.
78. The official source for “compound interest” (learn desk, item 1) is
Tap A, B, C or D.
Answer: D) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
79. The official source for “compound interest” (learn desk, item 2) is
Tap A, B, C or D.
Answer: B) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
80. The official source for “compound interest” (learn desk, item 3) is
Tap A, B, C or D.
Answer: A) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
81. The official source for “compound interest” (learn desk, item 4) is
Tap A, B, C or D.
Answer: B) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
82. The official source for “compound interest” (learn desk, item 5) is
Tap A, B, C or D.
Answer: A) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
83. The official source for “compound interest” (learn desk, item 6) is
Tap A, B, C or D.
Answer: C) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
84. The official source for “compound interest” (learn desk, item 7) is
Tap A, B, C or D.
Answer: D) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
85. The official source for “compound interest” (learn desk, item 8) is
Tap A, B, C or D.
Answer: A) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
86. The official source for “compound interest” (learn desk, item 9) is
Tap A, B, C or D.
Answer: B) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
87. The official source for “compound interest” (learn desk, item 10) is
Tap A, B, C or D.
Answer: A) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
88. The official source for “compound interest” (learn desk, item 11) is
Tap A, B, C or D.
Answer: B) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
89. The official source for “compound interest” (learn desk, item 12) is
Tap A, B, C or D.
Answer: D) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
90. The official source for “compound interest” (learn desk, item 13) is
Tap A, B, C or D.
Answer: C) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
91. The official source for “compound interest” (learn desk, item 14) is
Tap A, B, C or D.
Answer: D) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
92. The official source for “compound interest” (learn desk, item 15) is
Tap A, B, C or D.
Answer: C) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
93. The official source for “compound interest” (learn desk, item 16) is
Tap A, B, C or D.
Answer: A) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
94. The official source for “compound interest” (learn desk, item 17) is
Tap A, B, C or D.
Answer: B) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
95. The official source for “compound interest” (learn desk, item 18) is
Tap A, B, C or D.
Answer: C) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
96. The official source for “compound interest” (learn desk, item 19) is
Tap A, B, C or D.
Answer: D) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
97. The official source for “compound interest” (learn desk, item 20) is
Tap A, B, C or D.
Answer: D) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
98. The official source for “compound interest” (learn desk, item 21) is
Tap A, B, C or D.
Answer: C) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
99. The official source for “compound interest” (learn desk, item 22) is
Tap A, B, C or D.
Answer: A) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
100. The official source for “compound interest” (learn desk, item 23) is
Tap A, B, C or D.
Answer: B) the authority or standard named on this page’s explainer
GKSchools English practice is original — not an official script.
