Quiz, Mathematics of Finance

What is the formula for calculating simple interest?

• Interest = Rate × Time
• Interest = Principal × Rate × Time
• Interest = Principal ÷ Rate × Time
• Interest = Principal + Rate + Time

If a principal amount of ₱50,000 is borrowed for 8 months at an annual interest rate of 3.5%, what is the interest?

• ₱500.00
• ₱750.00
• ₱1,166.67

• ₱933.33

A loan of ₱10,000 with an 10% annual interest rate is repaid after 2 years. What is the total maturity value?

• ₱2,000

• ₱11,000
• ₱12,000
• ₱13,000

Compound amount is calculated using which formula?

An investment of ₱8,000 earns 6% interest, compounded quarterly for 4 years. What is the future value?

• ₱2,151.88

• ₱9,920.00

• ₱1,920.00

• ₱10,151.88

An investment of ₱8,000 earns 6% interest, compounded quarterly for 4 years. How much is the interest earned?

• ₱2,151.88

• ₱9,920.00

• ₱1,920.00

• ₱10,151.88

What is the maturity value of a loan of ₱15,000 with an 8% annual interest rate for 8 months?

• ₱15,800.00

• ₱15,600.00

• ₱16,000.00

• ₱24,600.00

A businessman borrows ₱25,000 for 6 months at a rate of 1.25% per month. What is the simple interest?

• ₱156.25

• ₱1,875.00

• ₱26,875.00

• ₱25,156.25

What is the Annual Percentage Rate (APR)?

• The Annual Percentage Rate (APR) is the annualized cost of borrowing or the annual return on an investment expressed as a percentage.
• The APR is the total amount of money borrowed.
• APR is a fixed rate that does not change over time.
• The APR is the monthly payment amount expressed as a percentage.

If a purchase of ₱1,650 was made on January 18 and another purchase of ₱560 on January 27, what is the average daily balance at the end of the month if no payments were made?

• ₱710.97

• ₱835.48

• ₱817.42

• ₱1,200.00