Mathematics of FinanceMCQPYQ Dec 23Question 1257 of 512
All Questions

Mr. XYZ invested 60,000\displaystyle 60,000 in a nationalized bank in the form of fixed deposit at the rate of 7.5%\displaystyle 7.5\% per annum simple interest rate. He received 83,500\displaystyle 83,500 after the end of the term of fixed deposit. Calculate the period for which 60,000\displaystyle 60,000 was invested in fixed deposit.

Options

A3\displaystyle 3 years
B3.5\displaystyle 3.5 years
C4\displaystyle 4 years
D4.5\displaystyle 4.5 years
For any discrepancies in this question, email contact@cadada.in

Correct Answer

Option a3\displaystyle 3 years

All Options:

  • A3\displaystyle 3 years
  • B3.5\displaystyle 3.5 years
  • C4\displaystyle 4 years
  • D4.5\displaystyle 4.5 years

Ad

Detailed Solution & Explanation

**Derivation of Fixed Deposit Tenure** *Note: The question contains a typo in the amount received, stating it is 83,500. In standard CA Foundation exam problems, the received amount is 73,500, which yields a whole-number solution of 3 years.* Given: - Principal (P\displaystyle P) = Rs. 60,000\displaystyle \text{Rs. }60,000 - Simple Interest Rate (R\displaystyle R) = 7.5%\displaystyle 7.5\% per annum - Correct Amount received (A\displaystyle A) = Rs. 73,500\displaystyle \text{Rs. }73,500 **Step 1: Calculate simple interest earned (SI\displaystyle SI)** SI=AP=7350060000=Rs. 13,500SI = A - P = 73500 - 60000 = \text{Rs. }13,500 **Step 2: Solve for Time (T\displaystyle T)** SI=P×R×T100SI = \frac{P \times R \times T}{100} 13500=60000×7.5×T10013500 = \frac{60000 \times 7.5 \times T}{100} 13500=600×7.5×T13500 = 600 \times 7.5 \times T 13500=4500T13500 = 4500 T T=135004500=3 yearsT = \frac{13500}{4500} = 3 \text{ years} *(Using the database value of 83,500 yields T=5.22\displaystyle T = 5.22 years).* Hence, **Option A** 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

Exam Strategy Tip

Guaranteed 12-16 marks. Master your calculator! Learn the 'GT' and compound interest M+/M- tricks to solve annuity questions in 10 seconds without writing long formulas.

Related Comparison Tables

More Questions from Mathematics of Finance

Ready to Master Mathematics of Finance?

Practice all 512 questions with instant feedback, earn XP, track your streaks, and ace your CA Foundation exam.

Start Practicing — It's Free