Statistics & Applications

Financial Math

Easy

applied

Which of the following statements are correct about the sinking fund?

(A) It is a fixed term account.

(B) It is set-up for a particular upcoming expense.

(C) In the sinking fund a fixed amount at regular intervals is deposited.

(D) It can be used in any emergency.

Choose the correct answer from the options given below:

(A), (B) and (C) only

(A), (B) and (D) only

(B), (C) and (D) only

(A), (C) and (D) only

✅ Correct Option: 1

A sinking fund is a fixed-term account built up by regular fixed deposits earmarked for a specific known future expense, so (A), (B) and (C) hold.

(D) is false; money reserved for arbitrary emergencies describes an emergency fund, not a sinking fund.

2025: 22 May Shift 2

The declared rate of return compounded semi annually equivalent to the effective rate of return 10.25% per annum is:

2026: 22 May Shift 1

Match List-I with List-II

List-I	List-II
(A) Nominal rate of return	(I) $EMI=\frac{Principal+Interest}{Period\ in\ months}$
(B) CAGR	(II) $\frac{Original\ value\ of\ the\ asset-Salvage\ value\ of\ the\ asset}{Useful\ life\ of\ the\ asset}$
(C) Flat rate method	(III) $\frac{Current\ market\ value\ of\ investment-Original\ investment\ value}{Original\ investment\ value}\times100$
(D) Annual depreciation	(IV) $\left(\frac{Investment\ at\ the\ end\ of\ investment\ period}{Investment\ at\ the\ beginning\ of\ the\ period}\right)^{\frac{1}{investment\ period}}-1$

Choose the correct answer from the options given below:

2026: 21 May Shift 2

Mr. Bean wishes to purchase a house for ₹90,00,000 with a down payment of ₹10,00,000 and balance in EMI for 25 years on reducing balance payment basis. If bank charges 6% per annum compounded monthly, then his EMI is;

(Use $(1.005)^{300} = 4.4650$ )

2026: 19 May Shift 2

If the cash equivalent of a perpetuity of ₹ 1200 payable at the end of each quarter is ₹ 96,000, then the rate of interest convertible quarterly is:

2026: 21 May Shift 1

Ravi borrowed ₹15,00,000 from a bank to purchase a plot and decided to repay the loan in equal monthly installments (EMI) in 10 years. If bank charges interest at 10% per annum, then EMI using a flat rate method is

2025: 14 May Shift 2

Which of the following are NOT correct about "Sinking Fund"?

(A) It does not have any specific purpose.

(B) It can be used in any emergency.

(D) It is set up for a particular upcoming expense.

Choose the correct answer from the options given below:

Solution

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