Mathematics of FinanceMCQMTP Dec 23 Series IQuestion 1390 of 512
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The sum required to earn a monthly interest of Rs.$1200\displaystyle at $18\% P.a Simple Interest is -

Select Your Answer (Keyboard: A, B, C, D)
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Correct Answer

✅ Option c — Rs.$80,000$

All Options:

  • ARs.$80,000$
  • BRs.$90,000$
  • CRs.$80,000$
  • DNone of these

Detailed Solution & Explanation

**Derivation of Principal Amount** Given: - Monthly simple interest = Rs. 1,200\displaystyle Rs. \displaystyle \text{Rs. }1,200 - Rate of Interest (R\displaystyle R) = $18\%$ per annum - Time (T\displaystyle T) = 1\displaystyle 1 month = 112\displaystyle 112\displaystyle \frac{1}{12} year **Step 1: Set up the Simple Interest formula** SI=P×R×T100SI = P×R×T100\displaystyle \frac{P \times R \times T}{100} 1200=P×18×1121001200 = P×18×112100\displaystyle \frac{P \times 18 \times \frac{1}{12}}{100} 1200=1.5P1001200 = 1.5P100\displaystyle \frac{1.5 P}{100} 1200=0.015P1200 = 0.015 P **Step 2: Solve for P\displaystyle P** P=12000.015=Rs. 80,000P = \displaystyle \frac{1200}{0.015} = \text{Rs. }80,000 *(Note: Both Option A and Option C are listed as Rs. 80,000. Option C is marked correct in the key.)* 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

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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