11th Business Maths Weekly Test - 1 ( Financial Mathematics )

MABS Institution

11th Business Maths Weekly Test - 1 ( Financial Mathematics )-Aug 2020

Time : 1.30 Hours

Part - A

Multiple Choice Question - Answer All Question

The Income on 7 % stock at 80 is

9%
8.75%
8%
7%

An annuity in which payments are made at the beginning of each payment period is called

Annuity due
An immediate annuity
perpetual annuity
none of these

If ‘a’ is the annual payment, ‘n’ is the number of periods and ‘i’ is compound interest for Rs 1 then future amount of the annuity is

A = \(\frac{a}{i}(1+i)(1+i)^n-1]\)
A = \(\frac{a}{i}[(1+i)^n-1]\)
P = \(\frac{a}{i}\)
P = \(\frac{a}{i}(1+i)[1-(1+i)^{-n}]\)

A man purchases a stock of Rs 20,000 of face value 100 at a premium of 20%, then investment is

Rs 20,000
Rs 25,000
Rs 24,000
Rs 30,000

What is the amount related is selling 8% stacking 200 shares of face value 100 at 50.

16,000
10,000
7,000
9,000

Rs 5000 is paid as perpetual annuity every year and the rate of C.I 10 %. Then present value P of immediate annuity is

Rs 60,000
Rs 50,000
Rs 10,000
Rs 80,000

Example of contingent annuity is

Life insurance premium
An endowment fund to give scholarships to a student
Personal loan from a bank
All the above

The brokerage paid by a person on this sale of 400 shares of face value Rs.100 at 1% brokerage

Rs 600
Rs 500
Rs 200
Rs 400

A man received a total dividend of Rs 25,000 at 10% dividend rate on a stock of face value Rs.100, then the number of shares purchased.

3500
4500
2500
300

The annual income on 500 shares of face value 100 at 15% is

Rs 7,500
Rs 5,000
Rs 8,000
Rs 8,500

Part - B

Generic 2 - Answer All Question

The chairman of a society wishes to award a gold medal to a student getting highest marks in Business Mathematics. If this medal costs Rs 9,000 every year and the rate of compound interest is 15% what amount is to be deposited now.

A limited company wants to create a fund to help their employees in critical circumstances. The estimated expenses per month is Rs 18,000. Find the amount to be deposited by the company if the rate of compound interest is 15%.
Which is better investment? 7% of Rs 100 shares at Rs 120 (or) 8% of Rs 100 shares at Rs 135.

A cash prize of Rs 1,500 is given to the student standing first in examination of Business Mathematics by a person every year. Find out the sum that the person has to deposit to meet this expense. Rate of interest is 12% p.a

Find the market value of 325 shares of amount Rs 100 at a premium of Rs 18.

Part - C

Generic 3 - Answer All Question

What is the present value of an annuity of Rs.750 per annum received at the end of each year for 5 year,when the discount rate is 15%

Find the rate of dividend which gives an annual income of Rs.1200 for 150 shares of face value Rs.100

Which is the better investment?7% stock at 80(or) stock at 96.
Find the amount at the end of 12 years of an annuity of Rs 5,000 payable at the beginning of each year, if the money is compounded at 10% per annum.[(1.1)¹²=3.1384]

Find the present value of an annuity of Rs 900 payable at the end of 6 months for 6 years. The money compounded at 8% per annum. [(1.04)^–12 = 0.6252 ]

Part - D

Generic 5 - Answer All Question

A bank pays interest at the rate of 8% p.a. compounded quarterly. Find how much should be deposited in the bank at the beginning of each of 3 months for 5 years in order to accumulate to Rs.10,000 at the of 5 years.

What equal payments made at the beginning of each month for 3 years will accumulate to Rs.4,00,000 if money is worth 15% compounded monthly

Machine A costs Rs15,000 and machine B costs Rs 20,000. The annual income from A and B are Rs 4,000 and Rs 7,000 respectively. Machine A has a life of 4 years and B has a life of 7 years. Find which machine may be purchased. (Assume discount rate 8% p.a)[(1.08)^-4=0.7350'(1.08)^-7=0.5835
Equal amounts are invested in 12% stock at 95 (brokerage). If 12% stock brought at Rs.120 more by way of dividend income than the other, find the amount invested in each stock?

a bank pays 8% interest compounded quarterly. Determine the equal deposits to be made at the end of each quarter for 3 years so as to receive Rs.300 at the end of 3 years.

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11th Business Maths Weekly Test - 1 ( Financial Mathematics )

MABS Institution

11th Business Maths Weekly Test - 1 ( Financial Mathematics )-Aug 2020

Part - A

Multiple Choice Question - Answer All Question

The Income on 7 % stock at 80 is

An annuity in which payments are made at the beginning of each payment period is called

If ‘a’ is the annual payment, ‘n’ is the number of periods and ‘i’ is compound interest for Rs 1 then future amount of the annuity is

A man purchases a stock of Rs 20,000 of face value 100 at a premium of 20%, then investment is

What is the amount related is selling 8% stacking 200 shares of face value 100 at 50.

Rs 5000 is paid as perpetual annuity every year and the rate of C.I 10 %. Then present value P of immediate annuity is

Example of contingent annuity is

The brokerage paid by a person on this sale of 400 shares of face value Rs.100 at 1% brokerage

A man received a total dividend of Rs 25,000 at 10% dividend rate on a stock of face value Rs.100, then the number of shares purchased.

The annual income on 500 shares of face value 100 at 15% is

Part - B

Generic 2 - Answer All Question

The chairman of a society wishes to award a gold medal to a student getting highest marks in Business Mathematics. If this medal costs Rs 9,000 every year and the rate of compound interest is 15% what amount is to be deposited now.

A limited company wants to create a fund to help their employees in critical circumstances. The estimated expenses per month is Rs 18,000. Find the amount to be deposited by the company if the rate of compound interest is 15%.

Which is better investment? 7% of Rs 100 shares at Rs 120 (or) 8% of Rs 100 shares at Rs 135.

A cash prize of Rs 1,500 is given to the student standing first in examination of Business Mathematics by a person every year. Find out the sum that the person has to deposit to meet this expense. Rate of interest is 12% p.a

Find the market value of 325 shares of amount Rs 100 at a premium of Rs 18.

Part - C

Generic 3 - Answer All Question

What is the present value of an annuity of Rs.750 per annum received at the end of each year for 5 year,when the discount rate is 15%

Find the rate of dividend which gives an annual income of Rs.1200 for 150 shares of face value Rs.100

Which is the better investment?7% stock at 80(or) stock at 96.

Find the amount at the end of 12 years of an annuity of Rs 5,000 payable at the beginning of each year, if the money is compounded at 10% per annum.[(1.1)12=3.1384]

Find the present value of an annuity of Rs 900 payable at the end of 6 months for 6 years. The money compounded at 8% per annum. [(1.04)–12 = 0.6252 ]

Part - D

Generic 5 - Answer All Question

A bank pays interest at the rate of 8% p.a. compounded quarterly. Find how much should be deposited in the bank at the beginning of each of 3 months for 5 years in order to accumulate to Rs.10,000 at the of 5 years.

What equal payments made at the beginning of each month for 3 years will accumulate to Rs.4,00,000 if money is worth 15% compounded monthly

Machine A costs Rs15,000 and machine B costs Rs 20,000. The annual income from A and B are Rs 4,000 and Rs 7,000 respectively. Machine A has a life of 4 years and B has a life of 7 years. Find which machine may be purchased. (Assume discount rate 8% p.a)[(1.08)-4=0.7350'(1.08)-7=0.5835

Equal amounts are invested in 12% stock at 95 (brokerage). If 12% stock brought at Rs.120 more by way of dividend income than the other, find the amount invested in each stock?

a bank pays 8% interest compounded quarterly. Determine the equal deposits to be made at the end of each quarter for 3 years so as to receive Rs.300 at the end of 3 years.

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Find the amount at the end of 12 years of an annuity of Rs 5,000 payable at the beginning of each year, if the money is compounded at 10% per annum.[(1.1)¹²=3.1384]

Find the present value of an annuity of Rs 900 payable at the end of 6 months for 6 years. The money compounded at 8% per annum. [(1.04)^–12 = 0.6252 ]

Machine A costs Rs15,000 and machine B costs Rs 20,000. The annual income from A and B are Rs 4,000 and Rs 7,000 respectively. Machine A has a life of 4 years and B has a life of 7 years. Find which machine may be purchased. (Assume discount rate 8% p.a)[(1.08)^-4=0.7350'(1.08)^-7=0.5835