Mathematics of FinanceMCQPYQ Jan 21Question 1219 of 512
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A man invested one-third of his capital at 7%\displaystyle 7\%, one fourth at 8%\displaystyle 8\% and the remainder at 10%\displaystyle 10\%. If the annual income is 561\displaystyle 561. The capital is -

Options

A4,400\displaystyle 4,400
B5,500\displaystyle 5,500
C6,600\displaystyle 6,600
D5,800\displaystyle 5,800
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Correct Answer

Option c6,600\displaystyle 6,600

All Options:

  • A4,400\displaystyle 4,400
  • B5,500\displaystyle 5,500
  • C6,600\displaystyle 6,600
  • D5,800\displaystyle 5,800

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Detailed Solution & Explanation

**Derivation of Capital Amount** Given: - Let the total capital be C\displaystyle C. - One-third of capital (C/3\displaystyle C/3) is invested at r1=7%\displaystyle r_1 = 7\% simple interest. - One-fourth of capital (C/4\displaystyle C/4) is invested at r2=8%\displaystyle r_2 = 8\% simple interest. - Remaining capital is invested at r3=10%\displaystyle r_3 = 10\% simple interest. - Total annual income (interest earned in 1 year) = Rs. 561\displaystyle \text{Rs. }561 **Step 1: Express the remaining capital** Remaining Capital=CC3C4=C(1712)=5C12\text{Remaining Capital} = C - \frac{C}{3} - \frac{C}{4} = C \left(1 - \frac{7}{12}\right) = \frac{5C}{12} **Step 2: Set up the total annual interest equation** Total Interest=Interest1+Interest2+Interest3\text{Total Interest} = \text{Interest}_1 + \text{Interest}_2 + \text{Interest}_3 561=C3×7×1100+C4×8×1100+5C12×10×1100561 = \frac{\frac{C}{3} \times 7 \times 1}{100} + \frac{\frac{C}{4} \times 8 \times 1}{100} + \frac{\frac{5C}{12} \times 10 \times 1}{100} 561=C100(73+2+5012)561 = \frac{C}{100} \left( \frac{7}{3} + 2 + \frac{50}{12} \right) Simplify the sum inside the parenthesis: 73+2+256=14+12+256=516=8.5\frac{7}{3} + 2 + \frac{25}{6} = \frac{14 + 12 + 25}{6} = \frac{51}{6} = 8.5 561=C100×8.5561 = \frac{C}{100} \times 8.5 561=0.085C561 = 0.085 C **Step 3: Solve for C\displaystyle C** C=5610.085=Rs. 6,600C = \frac{561}{0.085} = \text{Rs. }6,600 Hence, **Option C** is the correct answer.

About This Chapter: Mathematics of Finance

Paper

Paper 3: Quantitative Aptitude

Weightage

12-16 Marks

Key Topics

Simple & Compound Interest, Annuity, Perpetuity

The most important mathematical chapter in the entire syllabus. It covers Simple Interest (SI), Compound Interest (CI), Nominal vs Effective rates, Present and Future Value, Annuities (Ordinary and Due), Sinking Funds, and Perpetuities. The concepts learned here are applied heavily in CA Intermediate and Final.

View Official ICAI Syllabus

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