C! FOUND!
TION QUANTITATIVE APTITUDE
CH!PTER WISE TEST 4
Chapter: Mathematics Of Finance
(!ll Questions are compulsory)
(Time allowed: 1;5 Hours) (Marks: 50 Q x 1 Mark each)
1. The effective rate of interest corresponding to a nominal rate 3% p.a payable half yearly is
(MTP 1 Mark, Oct’21)
(a) 3.2% p.a (b) 3.25% p.a
(c) 3.0225% p.a (d) None of these
2. A sum of money gets doubled in 5 years at X% simple interest. If the interest was Y%, the sum of
money would have become ten-fold in thirty years. What is Y – X (in %)
(a) 10 (b) 5
(c) 8 (d) None of the above
3. The nominal rate of growth is 17% and inflation is 9% for the five years. Let P be the Gross
Domestic Product (GDP) amount at the present year then the projected real GDP after 6 years is
(a) 1.587 P (b) 1.921 P
(c) 1.403 P (d) 2.51 P
4. The difference between Compound Interest and Simple Interest on a certain sum for 2 years at
6% p;a; is ₹ 13;50; Find the sum
(a) 3750 (b) 2750
(c) 4750 (d) None
5. The compound interest earned by a money lender on ₹ 7,000 for 3 years if the rate of interest for
3 years are 7%, 8% and 8.5% respectively is
(a) ₹ 1750 (b) ₹ 1800
(c) ₹ 1776 (d) None of these
6. Find the present value of an annuity of ₹ 1,000 payable at the end of each year for 10 years, if the
money is worth 5% effective.
(a) ₹ 7,724 (b) ₹ 7,000
(c) ₹ 8,000 (d) None of these
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7. The present value of annuity of ₹3,000 per annum for 15 years at 4;5% p;a C;I; annually is
(a) ₹ 23,809.41 (b) ₹ 32,214.60
(c) ₹ 32,908.41 (d) None of these
8. ! person desires to create a fund to be invested at 10% CI per annum to provide for a prize of ₹
300 every year. Using V = a/I find V and V will be
(a) ₹ 2,000 (b) ₹ 2,500
(c) ₹ 3,000 (d) None of these
9. The future value of annuity of ₹2000 for 5 years at 5 % compounded annually is given
(in nearest ₹) as
(a) ₹ 11, 051 (b) ₹ 21,021
(c) ₹ 1,56,24 (d) ₹ 61254
10. ! Maruti Zen cost ₹ 3,60,000; Its price depreciates at the rate of 10% of a year during the first two
years and at the rate of 20% in third year. Find the total depreciation.
(a) ₹ 1,26,720 (b) ₹ 1,15,620
(c) ₹ 1,25,000 (d) ₹ 1,10,520
11. Two equal sums were lent out at 7% and 5% simple interest respectively. The interest earned on
the two loans adds upto Rs.960 for four years. Find the sum lent out.
(a) ₹ 4000 (b) ₹ 3000
(c) ₹ 5000 (d) ₹ 6000
12. A sum of money amounts to Rs. 20,800 in 5 years and Rs. 22720 in 7 years. Find the principle and
rate of interest.
(a) Rs. 5000, 6% (b) Rs.16000, 6%
(c) Rs.80000, 8% (d) Rs. 10000, 10%
13. A machine can be purchased for Rs. 50,000. Machine will contribute Rs. 12,000 per year for the
next five years. Assume borrowing cost is 10% per annum. Determine whether machine should be
purchased or not: (P(5,0.10) = 3.79079 )
(a) Should be purchased (b) Should not be purchased
(c) Can’t say about purchase (d) None of the above
14. The cost of machinery Rs.1,25,000 if its useful life estimated to the 20 years and the rate of
depreciation of its cost is 10% p.a . Then scrap value of machinery is (given that (𝟎. 𝟗)𝟐𝟎 = 0.1215)
(a) ₹ 15,187 (b) ₹ 15,400
(c) ₹ 15,300 (d) ₹ 15,250
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15. Rs. 5000 is paid every year for 10 years to pay off a loan. What is the loan amount if interest be
14% per annum compounded annually? (P(10,0.14) = 5,21611)
(a) Rs.26000.33 (b) Rs.26080.55
(c) Rs.27080.55 (d) Rs.28080.55
16. Rs.2000 is invested at the end of each month in account paying interest 6% per compounded
monthly, What is the future value of this annuity after 10th payment ?
(a) Rs.20,440 (b) Rs.52,200
(c) Rs.53,300 (d) Rs.54,500
17. In what will be a sum of money double itself at 6.25% p.a . Simple interest?
(a) 5 years (b) 8 years
(c) 12 years (d) 16 years
18. A sum amount to Rs. 1331 at a principal of Rs.1000 at 10% compounded annually. Find the time
(a) 3.31 years (b) 4 years
(c) 3 years (d) 2 years
19. Rs. 8,000 becomes Rs. 10,000 in two years at simple interest. The amount that will become Rs. 6,875
in 3 years at the same rate of interest is:
(a) ₹ 4,850 (b) ₹ 5,000
(c) ₹ 5,500 (d) ₹ 5, 275
20. The effective rate equivalent to nominal rate of 6% compounded monthly is:
(a) 6.05 (b) 6.17
(c) 6.26 (d) 6.07
21. A person borrows Rs. 5,000 for 2 years at 4% p.a. simple interest. He immediately lends to another
𝟏
person at 6 % p.a. for 2 years. Find his gain in the transaction per year.
𝟒
(a) ₹ 112.50 (b) ₹ 125
(c) ₹ 225 (d) ₹ 167.50
22. Future value of an ordinary annuity (MTP 1 Mark, Mar’21)
(1+𝑖)𝑛 ,1 (1+𝑖)𝑛 +1
(a) 𝐴 (𝑛, 𝑖) = 𝐴 ⌊ 𝑖
⌋ (b) 𝐴 (𝑛, 𝑖) = 𝐴 ⌊ 𝑖
⌋
1,(1,𝑖)𝑛 (1+𝑖)𝑛 ,1
(c) 𝐴 (𝑛, 𝑖) = 𝐴⌊ 𝑖 ⌋ (d) 𝐴 (𝑛, 𝑖) = 𝐴 ⌊ 𝑖(1+𝑖)𝑛 ⌋
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23. The cost of machinery is Rs. 1,25,000/- if its useful life is estimated to be 20 years and the rate of
depreciation of its cost is 10% p.a., then the scrap value of the Machinery is [given that (𝟎. 𝟗)𝟐𝟎 =
0.12158]
(a) 15,197 (b) 15,400
(c) 15,300 (d) 15,250
24. If ! person invests Rs;5,000 in a three years’ investment that pays you 12% per annum; Calculate
the future value of the investment.
(a) ₹ 7024.64 (b) ₹ 7124.78
(c) ₹ 7324.48 (d) ₹ 7526.48
25. Anil bought a motor cycle costing Rs.1,50,000 by making a down payment of Rs.50, 000 and agreeing
to make equal annual payment for five years. How much would be each payment if the interest on
unpaid amount be 10% compounded annually? [ P (5, 0.10) = 3.7908]
(a) Rs.26379.66 (b) Rs.26300.70
(c) Rs.26500.70 (d) Rs.26370.70
26. Shoba borrows Rs.50,00,000 to buy a house. If he pays equal instalments for 20 years and 10%
interest on outstanding balance, what will be the equal annual instalment?
[Given : P(20,0.10) =8.51356 ]
(a) Rs.687298.4 (b) Rs.685298.4
(c) Rs.585298.4 (d) Rs.587298.4
27. How much money is to be invested every year so to accumulate Rs. 3,00,000 at the end of 10 years
if interest is compounded annually at 10% [ A (10,0.1) = 15.9374)
(a) Rs.18823.65 (b) Rs.18833.64
(c) Rs.18223.60 (d) Rs.16823.65
28; ! sum of money triples itself in 18 years under simple interest; what is the rate of interest per
annum?
(a) 9% (b) 9.09%
(c) 11.11% (d) 13%
29; What time will be required for a sum of money to double itself at 8 % Simple interest?
(a) 8 years (b) 8.5 years
(c) 12.5 years (d) 12 years
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30; What is the sum of money will amount to ₹ 11035;50 in four years at compound interest for 1 st ,
2nd, 3rd and 4th years being 4% , 3% , 2% and 1% respectively;
(a) ₹ 1000 (b) ₹ 11,000
(c) ₹ 1035 (d) ₹ 11,305
31; Find the present value of ₹ 10,000 to be required after 5 years, if the interest rate be 9 per cent
compounded annually (Given: (𝟏. 𝟎𝟗),𝟓 = 0;65)
(a) ₹ 5500 (b) ₹ 5600
(c) ₹ 6000 (d) ₹ 6650
32; ! Machine was purchased for ₹ 10,000; Its rate of depreciation is 10% in the first year and 5 % per
annum afterwards; Find the depreciated value of Machine after 7 years of purchase
(Given (𝟎. 𝟗𝟓)𝟔 = 0;7351)
(a) ₹ 6606 (b) ₹ 6616
(c) ₹ 6660 (d) ₹ 6661
33; ! man borrows ₹4000 from a bank at 10% compound interest; !t the end of every year ₹ 1,500 as
part of repayment of loan and interest; How much is still owe to the bank after three such
instalments [Given: (1;1)3 = 1;331\
(a) ₹ 824 (b) ₹ 820
(c) ₹ 724 (d) ₹ 720
34; The effective rate of interest for one-year deposit corresponding to a nominal 7 % rate of interest
per annum convertible quarterly; Is
(a) 7% (b) 7.5
(c) 7.4% (d) 7.18%
35; The future value of annuity of ₹1,000, made annually for 5 years at the interest of 14%
compounded annually is (Given (𝟏. 𝟏𝟒)𝟓 = 1;925410)
(a) ₹ 5610 (b) ₹ 6610
(c) ₹ 6160 (d) ₹ 6160
36; SI = 0;125 P at 10% p;a find the time
(a) 1.25 years (b) 25 years
(c) 0.25 years (d) none
37. A = Rs. 5,200, R = 5% p.a., T = 6 years, P will be
(a) ₹ 2,000 (b) ₹ 3,880
(c) ₹ 3,000 (d) None of these
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38. The time by which a sum of money would treble itself at 8% p. a C. I is
(a) 14.28 years (b) 14 years
(c) 12 years (d) None of these
39. The present value of an annuity of Rs. 80 for 20 years at 5% p.a is [Given (𝟏. 𝟎𝟓)𝟐𝟎 = 2.6533]
(a) Rs. 997 (appx.) (b) Rs. 900
(c) Rs. 1,000 (d) None of these
40. A person bought a house paying Rs. 20,000 cash down and Rs. 4,000 at the end of each year for
25 yrs. at 5% p.a. C.I. The cash down price is[ Given (𝟏. 𝟎𝟓)𝟐𝟓 = 3.386355]
(a) ₹ 75,000 (b) ₹ 76,000
(c) ₹ 76,375.80 (d) None of these
41. A man purchased a house valued at Rs. 3,00,000. He paid Rs. 2,00,000 at the time of purchase and
agreed to pay the balance with interest at 12% per annum compounded half yearly in 20 equal
half yearly instalments. If the first instalment is paid after six months from the date of purchase
then the amount of each instalment is.
(a) ₹ 8,718.45 (b) ₹ 8,769.21
(c) ₹ 7,893.13 (d) None of these
42. A person desires to create a fund to be invested at 10% CI per annum to provide for a prize of Rs.
300 every year. Using V = a/I find V and V will be
(a) ₹ 2,000 (b) ₹ 2,500
(c) ₹ 3,000 (d) None of these
43. A person invests Rs. 500 at the end of each year with a bank which pays interest at 10% p.a C.I.
annually. The amount standing to his credit one year after he has made his yearly investment for
the 12th time is.[Given (𝟏. 𝟏)𝟏𝟐 = 3.1384]
(a) ₹ 11,761.36 (b) ₹ 10,000
(c) ₹ 12,000 (d) None of these
44. A machine depreciates at 10% of its value at the beginning of a year. The cost and scrap value
realized at the time of sale being Rs. 23,240 and Rs. 9,000 respectively. For how many years the
machine was put to use?
(a) 7 years (b) 8 years
(c) 9 years (d) 10 years
45; The compound interest on half-yearly rests on Rs. 10,000 the rate for the first and second years
being 6% and for the third year 9% p.a. is
(a) ₹ 2,200 (b) ₹ 2,287
(c) ₹ 2,285 (d) ₹ 2,290.84
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46. The population of a town increases every year by 2 % of the population beginning of that year.
The number of years by which the total increase of population be 40% is
(a) 7 years (b) 10 years
(c) 17 years (approximately) (d) none of these
47. Find the future value of an annuity of Rs. 500 made annually for 7 years at interest rate of 14 %
per annum [Given that (1.14)7 = 2.5023]
(a) Rs. 5365.35 (b) Rs. 5000
(c) Rs. 5325.65 (d) Rs.6000.35
48. Rs. 200 invested at the end of each month in an account paying interest 6% per year compounded
monthly. What is the future value of this annuity after 10th payment? [Given that (1.005) 10 =
1.0511]
(a) Rs. 2045 (b) Rs.5055
(c) Rs.2044 (d) Rs.2065
49. Suppose your father decides to gift you Rs. 10,000 every year starting from today for the next five
years, you deposit this amount in a bank as and when you receive and get 10% per annum interest
rate compounded annually. What is the present value of this annuity? ( P(4, 0.10) = 3.16987)
(a) Rs.41, 698.70 (b) Rs.45, 698.70
(c) Rs.41, 698.70 (d) Rs.41, 698.70
50. Nominal Rate of Return
(a) Real Rate of Return – Inflation (b) Real Rate of Return + Inflation
(c) Inflation -Real Rate of return (d) None of the above
