Study Guide · Chapter 15
2.14 Translating Exam Phrasing into the Correct Formula
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SSC and RRB question-setters rarely say “find SI” or “find CI” in plain words — they dress the same calculation in different everyday language to test whether you can recognise the underlying structure. The table below maps common phrasings to the formula you should reach for immediately:
| Phrase in the question | What it actually means |
|---|---|
| “…lent at simple interest…” / “…borrowed and repaid with interest calculated on the original sum only…” | Use the SI formula directly |
| “…compounded annually…” / “…interest is added to the principal every year…” | Use the CI formula, annual compounding |
| “…compounded half-yearly / every six months…” | Halve the rate, double the number of periods |
| “…compounded quarterly / every three months…” | Quarter the rate, quadruple the number of periods |
| “…the difference between the interest earned by two people, one at SI and one at CI, on the same sum…” | Use the CI–SI difference formula for the given number of years |
| “…population increases every year by R%…” | Treat exactly like CI with a + sign |
| “…value of the machine falls / depreciates by R% every year…” | Treat like CI but with a − sign, i.e., multiply by (1 − R/100) each year |
| “…repaid in n equal yearly installments, interest at simple rate…” | Use the SI installment (accumulated-value) formula |
| “…repaid in n equal yearly installments, interest compounded annually…” | Use the CI installment (present-value/discounting) formula |
| “…amounts to Rs. X in m years and Rs. Y in (m+1) years…” | Divide the later amount by the earlier one to get (1 + R/100) directly |
| “…effective rate…” / “…equivalent annual rate…” | Use the effective annual rate formula for the stated compounding frequency |
Training yourself to instantly match the question’s wording to a row in this table — before you even start writing numbers — is what separates a 25-second solve from a 90-second one on this chapter’s questions. Read the full question once, identify which row it belongs to, and only then start substituting values.
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