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Chapter 9 of 10
Practice Quiz

Financial Mathematics

CBSE · Class 12 · Applied Mathematics

Practice quiz for Financial Mathematics — CBSE Class 12 Applied Mathematics. MCQs and questions with answers to test your preparation.

54 questions25 flashcards5 concepts

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Quick Quiz: Financial Mathematics

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1

Find the present value of a perpetuity that pays ₹800 at the end of each year, if the interest rate is 10% per annum.

2

A company needs ₹50,000 after 5 years. If they make equal annual deposits at the end of each year at 8% interest, what should be the annual deposit?

3

What is the effective rate equivalent to 12% nominal rate compounded quarterly?

4

Calculate EMI for a loan of ₹2,00,000 at 10% annual interest for 3 years using the flat rate method.

54 Questions·
multiple choicemultiple correctvery short answershort answerlong answer

Sample Questions

1multiple correct

Which of the following are characteristics of a perpetuity? (Select all correct answers)

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Payments continue forever, Present value can be calculated, Uses formula P = R/i

A perpetuity has infinite payments, calculable present value, undefined future amount, and no maturity date. The present value formula is P = R/i. Common misconception: thinking perpetuities have maturity dates.

2multiple choice

Find the CAGR if an investment grows from ₹10,000 to ₹16,105 in 5 years.

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10%

CAGR = [(EV/SV)^(1/n) - 1] × 100 = [(16,105/10,000)^(1/5) - 1] × 100 = [(1.6105)^0.2 - 1] × 100 = [1.10 - 1] × 100 = 10%. Common error: Using simple average instead of geometric mean.

3multiple choice

What is the purchase price of a ₹1,000, 8% bond redeemable at par in 10 years if the yield rate is 10%?

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₹877

Bond value = R[1-(1+i)⁻ⁿ]/i + F(1+i)⁻ⁿ. Here R = 80, i = 0.10, n = 10, F = 1000. Present value of annuity = 80 × 6.1446 = ₹491.57. Present value of principal = 1000 × 0.3855 = ₹385.54. Total = ₹877.11 ≈ ₹877. Common mistake: Using coupon rate instead of yield rate for discounting.

4multiple choice

Calculate annual depreciation for a machine costing ₹80,000 with scrap value ₹8,000 and useful life 8 years using straight line method.

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₹9,000

Annual depreciation = (Cost - Scrap value)/Useful life = (80,000 - 8,000)/8 = 72,000/8 = ₹9,000. This method provides uniform annual depreciation. Common error: Including scrap value in depreciation or dividing by wrong number of years.

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Frequently Asked Questions

What are the important topics in Financial Mathematics for CBSE Class 12 Applied Mathematics?
Financial Mathematics covers several key topics that are frequently asked in CBSE Class 12 board exams. Focus on the core concepts listed on this page and practise related questions to build confidence.
How to score full marks in Financial Mathematics — CBSE Class 12 Applied Mathematics?
Understand the core concepts first, then work through the 54 practice questions available for this chapter. Revise formulas and definitions regularly, and use flashcards for quick recall before the exam.

Sources & Official References

Content is aligned to the official syllabus. Refer to the board website for the latest curriculum.

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