Mathematics of FinanceMCQPYQ Dec 23Question 1253 of 512
All Questions

Mr. X makes a deposit of $50,000$ in the bank for a period $2.5$ years. If the rate of interest is $12\%$ per annum compounded half yearly, then the maturity value of the money deposited by Mr. X is: (where $(1.06)^5 = 1.3382$)

Select Your Answer (Keyboard: A, B, C, D)
For any discrepancies in this question, email contact@cadada.in

Correct Answer

✅ Option a — $66,910$

All Options:

  • A$66,910$
  • B$66,123$
  • C$67,925$
  • D$65,550$

Detailed Solution & Explanation

**Derivation of Maturity Value** Given: - Principal (P\displaystyle P) = Rs. 50,000\displaystyle Rs. \displaystyle \text{Rs. }50,000 - Time (t\displaystyle t) = $2.5$ years - Rate (r\displaystyle r) = $12\%$ per annum compounded half-yearly - Given: (1.06)5=1.3382\displaystyle (1.06)^5 = 1.3382 **Step 1: Calculate periodic rate (i\displaystyle i) and number of periods (n\displaystyle n)** - Periodic rate i=r2=12%2=6%=0.06\displaystyle i = \displaystyle \frac{r}{2} = \frac{12\%}{2} = 6\% = 0.06 per half-year. - Number of periods n=t×2=2.5×2=5\displaystyle n = t ×\displaystyle \times 2 = 2.5 ×\displaystyle \times 2 = 5 half-years. **Step 2: Calculate Maturity Value (A\displaystyle A)** A=P(1+i)nA = P(1 + i)^n A=50000(1.06)5A = 50000(1.06)^5 Using the given value (1.06)5=1.3382\displaystyle (1.06)^5 = 1.3382: A=50000×1.3382=Rs. 66,910A = 50000 ×\displaystyle \times 1.3382 = Rs. \displaystyle \text{Rs. }66,910 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