Mathematics of FinanceMCQMTP Oct 21Question 1340 of 512
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The sum required to earn a monthly interest of Rs 1200\displaystyle 1200 at 18%\displaystyle 18\% per annum Simple Interest is

Options

A50,000\displaystyle 50,000
B60,000\displaystyle 60,000
C80,000\displaystyle 80,000
Dnone of these
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Correct Answer

Option c80,000\displaystyle 80,000

All Options:

  • A50,000\displaystyle 50,000
  • B60,000\displaystyle 60,000
  • C80,000\displaystyle 80,000
  • Dnone of these

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Detailed Solution & Explanation

**Derivation of Principal Amount** Given: - Monthly simple interest = Rs. 1,200\displaystyle \text{Rs. }1,200 - Rate of Interest (R\displaystyle R) = 18%\displaystyle 18\% per annum - Time (T\displaystyle T) = 1\displaystyle 1 month = 112\displaystyle \frac{1}{12} year **Step 1: Set up the Simple Interest formula** SI=P×R×T100SI = \frac{P \times R \times T}{100} 1200=P×18×1121001200 = \frac{P \times 18 \times \frac{1}{12}}{100} 1200=1.5P1001200 = \frac{1.5 P}{100} 1200=0.015P1200 = 0.015 P **Step 2: Solve for P\displaystyle P** P=12000.015=Rs. 80,000P = \frac{1200}{0.015} = \text{Rs. }80,000 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

Exam Strategy Tip

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