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Future Value of A Single Amount MCQs - Accountancy Knowledge

This document contains 10 multiple choice questions about calculating future value of single amounts with compound interest. It provides examples of calculating future value with annual interest rates of 10%, 12%, and 8% compounded monthly, quarterly, and continuously over time periods of 5, 20, and 30 years. It also asks questions about which compounding frequency is preferable for borrowers and lenders and how to express interest rates as decimals.

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Tahir Rehman
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416 views

Future Value of A Single Amount MCQs - Accountancy Knowledge

This document contains 10 multiple choice questions about calculating future value of single amounts with compound interest. It provides examples of calculating future value with annual interest rates of 10%, 12%, and 8% compounded monthly, quarterly, and continuously over time periods of 5, 20, and 30 years. It also asks questions about which compounding frequency is preferable for borrowers and lenders and how to express interest rates as decimals.

Uploaded by

Tahir Rehman
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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5/15/2019 Future Value of a Single Amount MCQs | Accountancy Knowledge

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Future Value of a Single Amount MCQs


Contents [show]

MCQs 1-10

1. How much will Rs. 10,000 grow into in 5 years


if you earn 10%?

(a) Rs. 13,102

(b) Rs. 16,105 2


(c) Rs. 16,289

(d) None
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5/15/2019 Future Value of a Single Amount MCQs | Accountancy Knowledge

2. With continuous compounding at 10% for 30


years, the future value of an investment of Rs.
2,000 is closest to?

(a) Rs. 40,171

(b) Rs. 44,898

(c) Rs. 164,500

(d) None of Above

3. As a borrower, you should prefer the bank that


____________________ compound per year?

(a) Less times

(b) More times

(c) Interest

(d) None of the above

4. You deposit Rs. 45,000 into an account at 4%


interest compounded quarterly, how much would
you have in 5 years?

(a) Rs. 57,908 2

(b) Rs. 50,602

(c) Rs. 55, 687


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5/15/2019 Future Value of a Single Amount MCQs | Accountancy Knowledge

(d) Rs. 54,909

5. The Future Value (FV) of Rs. 1,000 in 5 years


at 5% interest rate will be?

Please select 2 correct answers

(a) Rs. 1,000.00

(b) Rs. 1,276.28

(c) Rs. 999.99

(d) Rs. 1,500.52

6. What is the future value of a Rs. 10,000 college


tuition fund if the nominal rate of interest is 12
percent compounded monthly for five years?

(a) Rs. 17,623

(b) Rs. 18,167

(c) Rs. 18,105

7. With continuous compounding at 8 percent for


20 years, what is the approximate future value of
a Rs. 20,000 initial investment?
2
(a) Rs. 52,000

(b) Rs. 93,219

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(c) Rs. 99,061

(d) Rs. 915,240

8. If compounding more time outcome will be


greater value, it is choice of?

(a) Borrower

(b) Lender

(c) Liabilities holder

(d) None

9. If bank giving 12% interest rate per year, then


per month it will be?

(a) 1%

(b) 12%

(c) 5%

(d) 6%

10. Which of the following expresses 6.5%?


2
(a) 0.0065

(b) 6.50

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5/15/2019 Future Value of a Single Amount MCQs | Accountancy Knowledge

(c) 0.650

(d) 0.0650

>> Read Future Value of a Single Amount Chapter.

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