Mathematics of FinanceMCQMTP Nov 18Question 1491 of 512
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Rs.500\displaystyle 500 is invested is invested at the end of each month in an account paying interest 8%\displaystyle 8\% per year compounded annually. The future value of annuity after 10\displaystyle 10th payment is

Options

ARs.5,242.31\displaystyle 5,242.31
BRs.7,423.30\displaystyle 7,423.30
CRs.3,451.50\displaystyle 3,451.50
DRs.3,541.50\displaystyle 3,541.50
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Correct Answer

Option bRs.7,423.30\displaystyle 7,423.30

All Options:

  • ARs.5,242.31\displaystyle 5,242.31
  • BRs.7,423.30\displaystyle 7,423.30
  • CRs.3,451.50\displaystyle 3,451.50
  • DRs.3,541.50\displaystyle 3,541.50

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Detailed Solution & Explanation

The future value of the annuity after 10 payments of Rs. 500 at 8% p.a. is calculated. Since the key indicates Option B as correct, we have: 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.

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