Marathon 1

CA Nishant Kumar
NISH10
Schedule
Date (Day) Topic
12-06-2023 (Monday) Time Value of Money
13-06-2023 (Tuesday) Logical Reasoning
14-06-2023 (Wednesday) Measures of Central Tendency and Dispersion
15-06-2023 (Thursday) Ratio, Proportion, Indices, Logarithms; Linear Inequalities
16-06-2023 (Friday) Equations; Statistical Description of Data
17-06-2023 (Saturday) Sequence and Series
18-06-2023 (Sunday) Sets, Relations, and Functions
19-06-2023 (Monday) Correlation and Regression
20-06-2023 (Tuesday) Index Numbers
21-06-2023 (Wednesday) Permutations and Combinations
22-06-2023 (Thursday) Probability
23-06-2023 (Friday) Theoretical Distributions
Highlights

Conceptual Revision Question Based Revision Last Day Preparation Tips Questions to Revise on the
day before ExamQuizzes
Chapter 4 – Time Value of Money

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Questions on Simple Interest

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Question 1 – ICAI SM
Sania deposited ₹50,000 in a bank for two years with the interest rate of 5.5% p.a. What
will be the final value of investment?
(a) ₹55,800 (b) ₹5,500 (c) ₹55,500 (d) ₹5,800

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Question 2 – ICAI SM
The sum required to earn a monthly interest of ₹1,200 at 18% p.a. SI is:
(a) ₹50,000 (b) ₹60,000 (c) ₹80,000 (d) None

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Question 3
₹8,000 becomes ₹10,000 in 1 year 8 months at simple interest. The amount that will
become ₹6,875 in 2 years 7 months at the same rate of interest is:
(a) ₹4,850 (b) ₹5,000 (c) ₹4,955 (d) ₹5,275

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Question 4 – ICAI SM
P = ₹8,500, A = ₹10,200, R = 12½% SI, t will be:
(a) 1 year 7 months (b) 2 years (c) 1½ year (d) None

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Question 5 – MTP December, 2021
A sum of money gets doubled in 5 years at x% simple interest. If the interest was y%, the
sum of money would have become ten-fold in thirty years. What is y – x (in %)?
(a) 10 (b) 5 (c) 8 (d) None

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Question 6 – MTP November, 2019
A person deposited a sum of ₹10,000 in a bank. After 2 years, he withdrew ₹4,000 and
at the end of 5 years, he received an amount of ₹7,900; then the rate of simple interest is:
(a) 6% (b) 5% (c) 10% (d) None

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Question 7 – May, 2018; MTP June, 2021
A person borrows ₹5,000 for 2 years at 4% p.a. simple interest. He immediately lends to
another person at 6¼% p.a. for 2 years. Find his gain in the transaction per year.
(a) ₹112.50 (b) ₹125 (c) ₹225 (d) ₹167.50

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Question 8 – June, 2011; MTP June, 2021
If a simple interest on a sum of money at 6% p.a. for 7 years is equal to twice of simple
interest on another sum for 9 years at 5% p.a., the ratio will be:
(a) 2 : 15 (b) 7 : 15 (c) 15 : 7 (d) 1 : 7

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Question 9 – MTP June, 2021
A sum of money amounts to ₹20,800 in 5 years and ₹22,720 in 7 years. Find the principal
and rate of interest.
(a) ₹5,000; 6% (b) ₹16,000; 6% (c) ₹80,000; 8% (d) ₹10,000; 10%

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Question 10 – MTP June, 2021
Two equal sums were lent out at 7% and 5% simple interest respectively. The interest
earned on the two loans adds upto ₹960 for four years. Find the sum lent out.
(a) ₹4,000 (b) ₹3,000 (c) ₹5,000 (d) ₹6,000

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Question 11 – MTP November, 2019
A trust fund has invested ₹30,000 in two different types of bonds which pays 5% and 7%
interest respectively. Determine how much amount is invested in each type of bond if
trust obtains an annual total interest of ₹1,600.
(a) ₹5,000 (b) ₹6,000 (c) ₹7,000 (d) ₹8,000

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Question 12 – December, 2022
A farmer borrowed ₹3,600 at the rate of 15% simple interest per annum. At the end of 4
years, he cleared this account by paying ₹4,000 and a cow. The cost of the cow is:
(a) ₹1,000 (b) ₹1,200 (c) ₹1,550 (d) ₹1,760

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Question 13 – July, 2021
A certain sum amounts to ₹15,748 in 3 years at simple interest at r % p.a. The same sum
amounts to ₹16,510 at ( r + 2 ) % p.a. simple interest in the same time. What is the value
of r?
(a) 10% (b) 8% (c) 12% (d) 6%

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Question 14 – December, 2021
An amount is lent at R% simple interest for R years and the simple interest amount was
one-fourth of the principal amount. Then R is _______.
(a) 5 (b) 6 (c) 5½ (d) 6½

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Questions on Compound Interest

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Question 15 – July, 2021
A sum of ₹x amounts to ₹27,900 in 3 years and to ₹41,850 in 6 years at a certain rate
percent per annum, when the interest is compounded yearly. The value of x is:
(a) 16,080 (b) 18,600 (c) 18,060 (d) 16,800

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Question 16 – ICAI SM
Mr. X borrowed ₹5,120 at 12½% p.a. C.I. At the end of 3 years, the money was repaid
along with the interest accrued. The amount of interest paid by him is:
(a) ₹2,100 (b) ₹2,170 (c) ₹2,000 (d) None

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Question 17 – ICAI SM
If A = ₹1,000; n = 2 years; R = 6% p.a. compound interest payable half-yearly, then
Principal (P) is:
(a) ₹888.50 (b) ₹885 (c) ₹800 (d) None

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Question 18 – ICAI SM
The compound interest on half-yearly rests on ₹10,000 the rate for the first and second
years being 6% and for the third year 9% p.a. is:
(a) ₹2,200 (b) ₹2,287 (c) ₹2,285 (d) ₹2,290.84

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Question 19 – ICAI SM
On what sum will the compound interest at 5% p.a. for two years compounded annually
be ₹1,640?
(a) ₹2,200 (b) ₹1,487.53 (c) ₹16,000 (d) None

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Question 20 – ICAI SM
What annual rate of interest compounded annually doubles an investment in 7 years?
1
Given that 2 = 1.104090 .
7

(a) 11.41% (b) 10% (c) 10.41% (d) None

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Question 21 – ICAI SM
The population of a town increases every year by 2% of the population at the beginning
of that year. The number of years by which the total increase of population be 40% is:
(a) 7 years (b) 10 years (c) 17 years (approx.) (d) None

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Question 22 – ICAI SM
The annual birth and death rates per 1,000 are 39.4 and 19.4 respectively. The number of
years in which the population will be doubled assuming there is no immigration or
emigration is:
(a) 35 years (b) 30 years (c) 25 years (d) None

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Question 23 – ICAI SM
A = ₹5,200, R = 5% p.a., T = 6 years, P will be
(a) ₹2,000 (b) ₹3,880 (c) ₹3,000 (d) None

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Question 24 – MTP December, 2020
A man borrows ₹4,000 from a bank at 10% compound interest. At the end of every year
₹1,500 as part of repayment of loan and interest. How much is still owed to the bank after
three such instalments [Given: (1.1)3 = 1.331]
(a) ₹359 (b) ₹820 (c) ₹724 (d) ₹720

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Question 25 – December, 2022
A trust fund has invested ₹27,000 money in two schemes ‘A’ and ‘B’ offering compound
interest at the rate of 8% and 9% per annum respectively. It the total amount of interest
accrued through these two schemes together in two years was ₹4,818.30, what was the
amount invested in scheme ‘A’?
(a) ₹12,000 (b) ₹12,500 (c) ₹13,000 (d) ₹12,500

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Question 26 – December, 2022
A sum of money invested of compound interest double itself in four years. In how many
years it become 32 times of itself at the same rate of compound interest.
(a) 12 years (b) 16 years (c) 20 years (d) 18 years

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Questions Based on Depreciation

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Question 27 – MTP December, 2020
A Machine was purchased for ₹10,000. Its rate of depreciation is 10% in the first year
and 5% per annum afterwards. Find the depreciated value of Machine after 7 years of

purchase. Given : ( 0.95) = 0.7351
6

(a) ₹6,606 (b) ₹6,616 (c) ₹6,660 (d) ₹6,661

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Question 28 – December, 2022
A machine worth ₹4,90,740 is depreciated at 15% on its opening value each year. When
its value would reduce to ₹2,00,750?
(a) 5 years 5 months (b) 5 years 6 months (c) 5 years 7 months (d) 5 years 8 months

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Question 29 – ICAI SM
A machine worth ₹4,90,740 is depreciated at 15% of its opening value each year. When
its value would reduce by 90%?
(a) 11 years 6 months (b) 11 years 7 months
(c) 11 years 8 months (d) 14 years 2 months

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Questions Based on Difference Between Compound Interest
and Simple Interest

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Question 30 – June, 2006; MTP June, 2021
The difference between the simple and compound interest on a certain sum for 3 years at
5% p.a. is ₹228.75. The compound interest on the sum for 2 years at 5% p.a. is:
(a) ₹3,175 (b) ₹3,075 (c) ₹3,275 (d) ₹2,975

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Question 31 – MTP December, 2020
The difference between simple interest and compound interest on a sum of ₹6,00,000 for
two years is ₹6,000. What is the annual rate of interest?
(a) 8% (b) 10% (c) 6% (d) 12%

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Question 32 – July, 2021
What is the difference (in ₹) between the simple interest and the compound interest on a
2
sum of ₹8,000 for 2 years at the rate of 10% p.a., when the interest is compounded
5
yearly?
(a) 136.12 (b) 129.50 (c) 151.75 (d) 147.20

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Questions Based on Effective Rate of Interest

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Question 33 – ICAI SM
Which is a better investment 3% per year compounded monthly or 3.2% per year simple
interest? Given that (1 + 0.0025)12 = 1.0304.
(a) Compound Interest (b) Simple Interest (c) Don’t Know (d) None

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Questions Based on Future Value of Annuity

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Question 34 – June, 2022
Ankit invests ₹3,000 at the end of each quarter receiving interest @ 7% per annum for 5
years. What amount will be received at the end of the period?
(a) ₹71,200.20 (b) ₹71,104.83 (c) ₹73,204.83 (d) None

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Question 35 – ICAI SM; MTP May, 2019
₹200 is invested at the end of each month in an account paying interest 6% per year
compounded monthly. What is the future value of this annuity after 10th payment? Given
that (1.005)10 = 1.0511.
(a) ₹2,047 (b) ₹2,046 (c) ₹2,044 (d) ₹2,045

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Question 36 – MTP November, 2019
At six months’ intervals A deposited ₹1,000 in a savings account which credits interest
at 10% p.a., compounded semi-annually. The first deposit was made when A’s son was
6 months old and last deposit was made when his son was 8 years old. The money
remained in the account and was presented to the son on his 10th birthday. How much did
he receive? ((1.06)16 = 2.1829)
(a) ₹25,740 (b) ₹23,740 (c) ₹25,860 (d) ₹25,760

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0 0.5 1 1.5 2 2.5 3 3.5 4 4.5 5 5.5 6 6.5 7 7.5 8 8.5 9 9.5 10
1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000

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Question 37 – December, 2022
How much amount is required to be invested every year so as to accumulate ₹5,00,000
at the end of 12 years if interest is compounded annually at 10% {Where A(12, 0.1) =
21.384284}
(a) ₹23,381.65 (b) ₹24,385.85 (c) ₹26,381.65 (d) ₹28,362.75

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Question 38 – ICAI SM
A machine costs ₹5,20,000 with an estimated life of 25 years. A sinking fund is created
to replace it by a new model at 25% higher cost after 25 years with a scrap value
realization of ₹25,000. What amount should be set aside every year if the sinking fund
investments accumulate at 3.5% compound interest p.a.?
(a) ₹16,000 (b) ₹16,500 (c) ₹16,050 (d) ₹16,005

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Question 39 – December, 2022
Sinking fund factor is the reciprocal of:
(a) Present value interest factor of a single cash flow
(b) Present value interest factor of an annuity
(c) Future value interest factor of an annuity
(d) Future value interest factor of a single cash flow.

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Question 40 – December, 2022
Raju invests ₹20,000 every year in a deposit scheme starting from today for next 12 years.
Assuming that interest rate on this deposit is 7% per annum compounded annually. What
will be the future value of this annuity? Given that (1 + 0.07)12 = 2.25219150
(a) ₹5,40,576 (b) ₹3,82,813 (c) ₹6,43,483 (d) ₹3,57,769

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Question 41 – ICAI SM
Raja aged 40 wishes his wife Rani to have ₹40 lakhs at his death. If his expectation of
life is another 30 years and he starts making equal annual investments commencing now
at 3% compound interest p.a. how much should he invest annually?
(a) ₹84,448 (b) ₹84,450 (c) ₹84,449 (d) ₹84,080

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Questions Based on Present Value

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Question 42 – ICAI SM
The present value of ₹10,000 due in 2 years at 5% p.a. compound interest when the
interest is paid on half-yearly basis is ₹________.
(a) ₹9,070 (b) ₹9,069 (c) ₹9,061 (d) None

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Questions Based on Present Value of Annuity Regular

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Question 43 – MTP June, 2023
Find the present value of an ordinary annuity of 8 quarterly payments of ₹500 each, the
rate of interest being 8% p.a. compound quarterly.
(a) 4275.00 (b) 4725.00 (c) 3662.50 (d) 3266.50

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Questions Based on Applications of Present Value of Annuity
Regular

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Question 44 – June, 2022
₹2,500 is paid every year for 10 years to pay off a loan. What is the loan amount if the
interest rate is 14% per annum compounded annually?
(a) ₹15,841.90 (b) ₹13,040.27 (c) ₹14,674.21 (d) ₹14,010.90

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Question 45 – ICAI SM
Appu retires at 60 years receiving a pension of ₹14,400 a year paid in half-yearly
installments for rest of his life after reckoning his life expectation to be 13 years and that
interest at 4% p.a. is payable half-yearly. What single sum is equivalent to his pension?
(a) ₹1,45,000 (b) ₹1,44,900 (c) ₹1,44,800 (d) ₹1,44,700

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Question 46 – MTP December, 2021
A took a loan from B. The loan is to be repaid in annual installments of ₹2,000 each. The
first instalment is to be paid three years from today and the last one is to be paid 8 years
from today? What is the value of loan today, using a discount rate of eight percent?
(a) ₹9,246 (b) ₹7,927 (c) ₹8,567 (d) None

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Question 47 – July, 2021
A loan of ₹1,02,000 is to be paid back in two equal annual instalments. If the rate of
interest is 4% p.a., compounded annually, then the total interest charged (in ₹) under this
instalment plan is:
(a) 6,160 (b) 8,120 (c) 5,980 (d) 7,560

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Question 48 – ICAI SM; MTP June, 2023
Mr. Paul borrows ₹20,000 on condition to repay it with C.I. at 5% p.a. in annual
installments of ₹2,000 each. The number of years for the debt to be paid off is:
(a) 10 years (b) 12 years (c) 11 years (d) 14.2 years

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Question 49 – ICAI SM
A man purchased a house valued at ₹3,00,000. He paid ₹2,00,000 at the time of purchase
and agreed to pay the balance with interest at 12% per annum compounded half yearly in
20 equal half-yearly instalments. If the first instalment is paid after six months from the
date of purchase then the amount of each instalment is:
(a) ₹8,718.45 (b) ₹8,769.21 (c) ₹7,893.13 (d) None

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Question 50 – ICAI SM; MTP May, 2020
A person bought a house paying ₹20,000 cash down and ₹4,000 at the end of each year
for 25 yrs. at 5% p.a. C.I. The cash down price is:
[Given (1.05)25 = 3.386355]
(a) ₹75,000 (b) ₹76,000 (c) ₹76,375.80 (d) None

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Question 51 – MTP December, 2021
Arun purchased a vacuum cleaner by giving ₹1700 as cash down payment, which will be
followed by five EMIs of ₹480 each. The vacuum cleaner can also be bought by paying
₹3900 cash. What is the approx. rate of interest p.a. (at simple interest) under this
instalment plan?
(a) 18% (b) 19% (c) 22% (d) 20%

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Question 52 – MTP June, 2021
A company is considering proposal of purchasing a machine either by making full
payment of ₹4,000 or by leasing it for four years at an annual rate of ₹1,250. Which
course of action is preferable if the company can borrow money at 14% compounded
annually?
(a) Leasing (b) Purchasing (c) Don’t Know (d) None

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Question 53 – June, 2019 (Similar)
ABC Ltd. wants to lease out an asset costing ₹3,60,000 for a five-year period. It has fixed
a rental of ₹1,05,000 per annum payable annually starting from the end of first year.
Suppose rate of interest is 14% per annum compounded annually on which money can
be invested by the company. Is this agreement favourable to the company?
(a) No (b) Yes (c) Don’t Know (d) None

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Question 54 – MTP June, 2023; ICAI SM
A machine with useful life of seven years costs ₹10,000 while another machine with
useful life of five years costs ₹8,000. The first machine saves labour expenses of ₹1,900
annually and the second one saves labour expenses of ₹2,200 annually. Determine the
preferred course of action. Assume cost of borrowing as 10% compounded per annum.
(a) First Machine (b) Second Machine (c) Don’t Know (d) None

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Question 55 – July, 2021
If the cost of capital be 12% per annum, then the Net Present Value (in nearest ₹) from
the given cash flow is given as:
Year 0 1 2 3
Operating Profit (in thousand ₹) (100) 60 40 50

(a) ₹34,048 (b) ₹34,185 (c) ₹51,048 (d) ₹21,048

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Question 56 – ICAI SM
An investor intends purchasing a three-year ₹1,000 par value bond having nominal
interest rate of 10%. At what price the bond may be purchased now if it matures at par
and the investor requires a rate of return of 14%?
(a) ₹907.125 (b) ₹800.125 (c) ₹729.12 (d) None

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Question 57 – MTP June, 2023
Find the purchase price of a ₹1,000 bond redeemable at the paying annual dividends at
4% if the yield rate is to be 5% effective.
(a) ₹884.16 (b) ₹984.17 (c) ₹1,084.16 (d) None

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Question 58 – ICAI SM
Suppose your mom decides to gift you ₹10,000 every year starting from today for the
next five years. You deposit this amount in a bank as and when you receive and get 10%
per annum interest rate compounded annually. What is the present value of this annuity?
(a) ₹91,000 (b) ₹79,489 (c) ₹41,698.70 (d) None

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Questions Based on Perpetuity

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Question 59 – ICAI SM
Ramesh wants to retire and receive ₹3,000 a month. He wants to pass this monthly
payment to future generations after his death. He can earn an interest of 8% compounded
annually. How much will he need to set aside to achieve his perpetuity goal?
(a) ₹4,30,000 (b) ₹4,50,000 (c) ₹4,20,000 (d) None

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Question 60 – July, 2021
If a person bought a house by paying ₹45,00,000 down payment and ₹80,000 at the end
of each year till the perpetuity. Assuming the rate of interest as 16% the present value of
house (in ₹) is given as:
(a) 47,00,000 (b) 45,00,000 (c) 57,80,000 (d) 50,00,000

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Question 61 – December, 2020
A stock pays annually an amount of ₹10 from 6th year onwards. What is the present value
of the perpetuity, if the rate of return is 20%?
(a) 20.1 (b) 19.1 (c) 21.1 (d) 22.1

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Question 62 – June, 2022
Assuming that the discount rate is 7% per annum, how much would you pay to receive
₹50, growing at 5%, annually, forever?
(a) ₹4,300 (b) ₹2,500 (c) ₹4,200 (d) None

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Questions Based on Nominal Rate of Return

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Question 63 – ICAI SM
Real Rate of Return = 5%; Inflation Rate = 2%. What is the Nominal Rate of Return?
(a) 7% (b) 9% (c) 11% (d) None

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Question 64 – July, 2021
The nominal rate of growth is 17% and inflation is 9% for the five years. Let P be the
Gross Domestic Product (GDP) amount at the present year, then the projected real GDP
after 6 years is:
(a) 1.587P (b) 1.921P (c) 1.403P (d) 2.51P

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Questions Based on Compound Annual Growth Rate (CAGR)

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Question 65 – June, 2022
The CAGR of initial value of an investment of ₹15,000 and final value of ₹25,000 in 3
years is:
(a) 19% (b) 18.56% (c) 17.56% (d) 17%

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Question 66 – December, 2022
10 years ago, the earning per share (EPS) of ABC Ltd. was ₹5 share its EPS for this year
is ₹22. Compute at what rate, EPS of the company grows annually?
(a) 15.97% (b) 16.77% (c) 18.64% (d) 14.79%

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Question 67 – July, 2021
Let the operating profit of a manufacturer for five years is given as:
Years 1 2 3 4 5 6
Operating Profit (in lakh ₹) 90 100 106.4 107.14 120.24 157.34
The Compound Annual Growth Rate (CAGR) of Operating Profit for year 6 with respect
to year 2 is:
(a) 9% (b) 12% (c) 11% (d) 13%

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