Maths MCQ on Interest

A loan that requires the borrower to make the same payment every period until the maturity date is called a

A coupon bond pays the owner of the bond

A credit market instrument that pays the owner the face value of the security at the maturity date and nothing prior to then is called a

(I) A simple loan requires the borrower to repay the principal at the maturity date along with an interest payment. (II) A discount bond is bought at a price below its face value, and the face value is repaid at the maturity date.

Which of the following are true of coupon bonds?

Which of the following are generally true of all bonds?

(I) A discount bond requires the borrower to repay the principal at the maturity date plus an interest payment. (II) A coupon bond pays the lender a fixed interest payment every year until the maturity date, when a specified final amount (face or par value) is repaid.

f a $5,000 coupon bond has a coupon rate of 13 percent, then the coupon payment every year is

An $8,000 coupon bond with a $400 annual coupon payment has a coupon rate of

The concept of _____ is based on the common-sense notion that a dollar paid to you in the future is less valuable to you than a dollar today.

Dollars received in the future are worth _____ than dollars received today. The process of calculating what dollars received in the future are worth today is called _____

The process of calculating what dollars received in the future are worth today is called

With an interest rate of 5 percent, the present value of $100 received one year from now is approximately

With an interest rate of 10 percent, the present value of a security that pays $1,100 next year and $1,460 four years from now is

With an interest rate of 8 percent, the present value of $100 received one year from now is approximately

With an interest rate of 6 percent, the present value of $100 received one year from now is approximately

The interest rate that equates the present value of payments received from a debt instrument with its market price today is the

The interest rate that financial economists consider to be the most accurate measure is the

Financial economists consider the ______ to be the most accurate measure of interest rates.

For a simple loan, the simple interest rate equals the

For simple loans, the simple interest rate is _____ the yield to maturity

The yield to maturity of a one-year, simple loan of $500 that requires an interest payment of $40 is

The yield to maturity of a one-year, simple loan of $400 that requires an interest payment of $50 is

A $10,000, 8 percent coupon bond that sells for $10,000 has a yield to maturity of

Which of the following $1,000 face value securities has the highest yield to maturity?

Which of the following are true for a coupon bond?

Which of the following are true for a coupon bond?

The yield to maturity on a consol bond that pays $100 yearly and sells for $500 is

The yield to maturity on a consol bond that pays $200 yearly and sells for $1000 is

The yield to maturity for a one-year discount bond equals

If a $10,000 face value discount bond maturing in one year is selling for $8,000, then its yield to maturity is

If a $10,000 face value discount bond maturing in one year is selling for $9,000, then its yield to maturity is

If a $10,000 face value discount bond maturing in one year is selling for $9,000, then its yield to maturity is

If a $10,000 face value discount bond maturing in one year is selling for $5,000, then its yield to maturity is

If a $5,000 face value discount bond maturing in one year is selling for $5,000, then its yield to maturity is

Which of the following are true for the current yield?

The nearer the bond’s price is to the bond’s par value and the longer the maturity of the bond the more closely _____ approximates _____

The current yield is a less accurate measure of the yield to maturity the ______ the time to maturity of the bond and the ______ the price is from/to the par value.

The current yield on a $6,000, 10 percent coupon bond selling for $5,000 is

The current yield on a $5,000, 8 percent coupon bond selling for $4,000 is

For a consol, the current yield is an _____ of the yield to maturity.

Which of the following are true of the yield on a discount basis as a measure of the interest rate?

The formula for the measure of the interest rate called the yield on a discount basis is peculiar because

The yield on a discount basis of a 180-day $1,000 Treasury bill selling for $950 is

The yield on a discount basis of a 90-day $1,000 Treasury bill selling for $950 is

The yield on a discount basis of a 90-day $1,000 Treasury bill selling for $900 is

The yield on a discount basis of a 180-day $1,000 Treasury bill selling for $900 is

The Fisher equation states that

If you expect the inflation rate to be 15 percent next year and a one-year bond has a yield to maturity of 7 percent, then the real interest rate on this bond is

If you expect the inflation rate to be 5 percent next year and a one-year bond has a yield to maturity of 7 percent, then the real interest rate on this bond is

The nominal interest rate minus the expected rate of inflation

In which of the following situations would you prefer to be making a loan?

In which of the following situations would you prefer to be borrowing?

What is the return on a 5 percent coupon bond that initially sells for $1,000 and sells for $1,200 one year later?

What is the return on a 5 percent coupon bond that initially sells for $1,000 and sells for $900 one year later?

The return on a 5 percent coupon bond that initially sells for $1,000 and sells for $1,100 one year later is

The return on a 10 percent coupon bond that initially sells for $1,000 and sells for $900 one year later is

Which of the following are true concerning the distinction between interest rates and return?

If the interest rates on all bonds rise from 5 to 6 percent over the course of the year, which bond would you prefer to have been holding?

Suppose you are holding a 5 percent coupon bond maturing in one year with a yield to maturity of 15 percent. If the interest rate on one-year bonds rises from 15 percent to 20 percent over the course of the year, what is the yearly return on the bond you are holding?

(I) Prices of longer-maturity bonds respond more dramatically to changes in interest rates. (II) Prices and returns for long-term bonds are less volatile than those for short-term bonds.

(I) Prices of longer-maturity bonds respond less dramatically to changes in interest rates. (II) Prices and returns for long-term bonds are less volatile than those for shorter-term bonds.

The riskiness of an asset’s return that results from interest rate changes has been given the special name of

If an investor’s holding period is longer than the term to maturity of a bond, the investor is exposed to

(I) The average lifetime of a debt security’s stream of payments is called duration. (II) The duration of a portfolio is the weighted average of the durations of the individual securities, with the weights reflecting the proportion of the portfolio invested in each.

The duration of a ten-year, 10 percent coupon bond when the interest rate is 10 percent is 6.76 years. What happens to the price of the bond if the interest rate falls to 8 percent?

Government securities with terms of more than one year are called:

Money is:

An item designated as money that is intrinsically worthless is:

Money that a government has required to be accepted in settlement of debts is:

Which of the following is included in broad money, but not included in narrow money?

A checking deposit in a bank is considered __________ of that bank.

Which of the following activities is one of the responsibilities of the Bank of England to the banking system?

The difference between a bank’s actual reserves and its required reserves is its:

As the required reserve ratio is decreased, the money multiplier:

A bank has excess reserves to lend but is unable to find anyone to borrow the money. This will __________ the size of the money multiplier.

Assume that commercial banks are holding excess reserves because business firms and consumers are not willing to borrow money. A decrease in the discount rate is likely to:

If the quantity of money demanded exceeds the quantity of money supplied, then the interest rate will:

When economists speak of the ‘demand for money’, which of the following questions are they asking?

Which of the following events will lead to a decrease in the equilibrium interest rate?

An automobile financier claims to be lending money at simple interest, but he includes the interest every six months for calculating the principal. If he is charging an interest of 10%, the effective rate of interest becomes:

A sum of money at simple interest amounts to Rs. 815 in 3 years and to Rs. 854 in 4 years. The sum is:

Sum of money becomes Rs. 13,380 after 3 years and Rs. 20,070 after 6 years on compound interest. The sum is:

A sum of Rs. 12,000 deposited at compound interest becomes double after 5 years. After 20 years, it will become:

A sum of money placed at compound interest doubles itself in 5 years. It will amount to eight times itself at the same rate of interest in:

If a sum on compound interest becomes three times in 4 years, then with the same interest rate, the sum will become 27 times in:

The least number of complete years in which a sum of money put out at 20% compound interest will be more than doubled is:

The least number of complete years in which a sum of money put out at 20% compound interest will be more than doubled is:

What annual payment will discharge a debt of Rs. 1025 due in 2 years at the rate of 5% compound interest?

A man borrows Rs. 12,500 at 20% compound interest. At the end of every year he pays Rs. 2000 as part repayment. How much does he still owe after three such instalments?

A lent Rs. 5000 to B for 2 years and Rs. 3000 to C for 4 years on simple interest at the same rate of interest and received Rs. 2200 in all from both of them as interest. The rate of interest per annum is ?

Sachin borrows Rs. 5000 for 2 years at 4% p.a. simple interest. He immediately lends money to Rahul at 25/4% p.a. for 2 years. Find the gain of one year by Sachin. ?

Ashok took a loan of Rs. 15000 for 3 years at simple interest. If the total interest paid is R. 2700, what is the rate of interest per annum ??

Reena took a loan of Rs. 1200 with simple interest for as many years as the rate of interest. If she paid Rs. 432 as interest at the end of the loan period, what was the rate of interest? ?

A money lender finds that dues to a fall in the annual rate of interest from 8% to 7×3/4%, his yearly income diminishes by Rs. 61.50. His capital is ?

If A lends Rs. 3500 to B at 10% p.a. and B lends the same sum to C at 11.5% p.a., then the gain of B (in Rs.) in a period of 3 years is ?

Rakesh took a loan for 6 years at the rate of 5% p.a. S.I. If the total interest paid was Rs. 1230, the principal was : ?

A sum of Rs. 12,500 amounts to Rs. 15,500 in 4 years at the rate of simple interest. What is the rate of interest? ?

The difference between compound interest and simple interest on an amount of Rs.15,000 for 2 years is Rs.96. What is the rate of interest per annum?

The difference between simple and compound interests and compounded annually on a certain sum of money for 2 years at 4% per annum is Re. 1. The sum (in Rs.) is:

The compound interest on a sum of money for 2 years is Rs.832 and the simple interest on the same sum for the same period is Rs.800. The difference between the compound interest and the simple interest for 3 years will be:

The difference between the simple interest on a certain sum at the rate of 10% per annum for 2 years and compound interest which is compounded every 6 months is Rs.124.05. What is the principal sum?

The difference between compound interest and simple interest on a sum for 2 years at 10% per annum, when the interest is compounded annually is Rs.16. If the interest were compounded half-yearly, the difference in two interests would be:

A sum of money lent at compound interest for 2 years at 20% per annum would fetch Rs.482 more, if the interest was payable half-yearly than if it was payable annually. The sum is:

On a sum of money, the simple interest for 2 years is Rs.660, while the compound interest is Rs.696.30, the rate of interest being the same in both the cases. The rate of interest is:

The effective annual rate of interest corresponding to a nominal rate of 6% per annum payable half-yearly is:

Mr. Dua invested money in two schemes A and B offering compound interest @ 8 p.c.p.a. and 9 p.c.p.a. respectively. If the total amount of interest accrued through two schemes together in two years was Rs.4818.30 and the total amount invested wasRs.27,000, what was the amount invested in Scheme A?

Sum of money becomes Rs.13,380 after 3 years and Rs.20,070 after 6 years on compound interest. The sum is:

What is the rate of compound interest? I. The principal was invested for 4 years. II. The earned interest was Rs. 1491.

What will be compounded amount? I. Rs. 200 was borrowed for 192 months at 6% compounded annually. II. Rs. 200 was borrowed for 16 years at 6%.

An amount of money was lent for 3 years. What will be the difference between the simple and the compound interest earned on it at the same rate? I. The rate of interest was 8 p.c.p.a. II. The total amount of simple interest was Rs. 1200.

What is the rate of interest p.c.p.a.? I. An amount doubles itself in 5 years on simple interest. II. Difference between the compound interest and the simple interest earned on a certain amount in 2 years is Rs. 400. III. Simple interest earned per annum is Rs. 2000.

What will be the compound interest earned on an amount of Rs. 5000 in 2 years? I. The simple interest on the same amount at the same rate of interest in 5 years is Rs. 2000. II. The compound interest and the simple interest earned in one year is the same. III. The amount becomed more than double on compound interest in 10 years.

A bank offers 5% compound interest calculated on half-yearly basis. A customer deposits Rs. 1600 each on 1st January and 1st July of a year. At the end of the year, the amount he would have gained by way of interest is:

There is 60% increase in an amount in 6 years at simple interest. What will be the compound interest of Rs. 12,000 after 3 years at the same rate?

What is the difference between the compound interests on Rs. 5000 for 1 years at 4% per annum compounded yearly and half-yearly?

The compound interest on Rs. 30,000 at 7% per annum is Rs. 4347. The period (in years) is:

What will be the compound interest on a sum of Rs. 25,000 after 3 years at the rate of 12 p.c.p.a.?

At what rate of compound interest per annum will a sum of Rs. 1200 become Rs. 1348.32 in 2 years?

Albert invested an amount of Rs. 8000 in a fixed deposit scheme for 2 years at compound interest rate 5 p.c.p.a. How much amount will Albert get on maturity of the fixed deposit?

Simple interest on Rs..5,000 at 5% interest for 1 year will be Rs. ?

Compound interest on Rs.5,000 at 5% interest for 2 yeasr will be Rs. ?

Effective interest if nominal interest is 8% compounded annually will be Rs. ?

Effective interest if nominal interest is 8% compounded semiannually will be ?

Effective interest if nominal interest is 8% compounded quarterly will be?

Simple interest Is Interest earned on the ________ only.

Compound interest is interest earned on principal as well as on previously earned?

On one year investment, compound interest and simple interest earned are?

On two year investment, compound interest and simple interest earned are calculated, which one is greater?

On 1 year investment, compound interest compounded annually and compound interest compounded semiannually are calculated, which one is greater ?

Taking account of compounding changes, we use ?

In a group of 80 children, there are 22 more girls than boys. How many girls are there in the group?

In a group of 80 children, there are 22 more girls than boys. How many girls are there in the group?

A shopkeeper sold a pair of shoes for Rs.375. If his profit was 13% of the selling price, the cost profit was ?

Salman bought few mangoes, then he bought 6 more mangoes, he ate 3 mangoes, result is one and a half times the mangoes he originally he originally bought ?

If a man were to sell his bag for Rs.200, he would lose 20%. What must he sell it for to gain 10% ?

If a man were to sell his horse for Rs.720, he would lose 25%. What must he sell it for to gain 25% ?

The cost price of 12 articles is equal to the selling price of 10 articles, profit percentage is?

The angular velocity depends upon the rate of change of the?

A car traveling at 70 Km/ hr east turns south without a change in speed. The car is moving with?