Mathematics of FinanceMCQMTP Dec 23 Series IQuestion 1389 of 512
All Questions

The amount charged for a defined length of time for uses of principal, generally on year basis is known as

Options

ABalance
BRate of Interest
CPrincipal
DInterest
For any discrepancies in this question, email contact@cadada.in

Correct Answer

Option bRate of Interest

All Options:

  • ABalance
  • BRate of Interest
  • CPrincipal
  • DInterest

Ad

Detailed Solution & Explanation

**Identification of the Definition** - **Interest** is the cost of using borrowed money. - **Rate of Interest** is the percentage rate charged per unit of time (generally on a yearly basis) for the use of the principal. Hence, **Option B** 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