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Advanced Calculations - A general quiz on Unit 1

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  • Calculate the compound interest on R1000 at 10% per year for 2 years.
    A = 1000(1 + 10/100)^2 = 1000(1.1)^2 = 1210. CI = 1210 – 1000 = R210.
  • If a bank offers 9% simple interest, what is the interest on R2000 for 5 years?
    I = 2000 × 9 × 5 ÷ 100 = R900.
  • What is a budget?
    A plan for how to spend and save your money over a specific period, showing your income and expenses.
  • If you invest R5000 at 6% simple interest for 3 years, how much interest will you earn?
    I = 5000 × 6 × 3 ÷ 100 = R900.
  • What is the purpose of a national budget?
    To show how the government plans to collect and spend money.
  • If the total amount after 4 years is R5600 and the principal was R5000, find the simple interest earned.
    R5600 – R5000 = R600.
  • What is the formula for compound interest?
    A = P(1 + R/100)^T or CI = A – P.
  • What does it mean to ‘break even’ in a budget?
    Your income equals your expenses.
  • If you borrow R2000 at 12% compound interest for 2 years, what is the total amount payable?
    Answer: A = 2000(1 + 12/100)^2 = 2000(1.2544) = R2508.80.
  • What is the difference between fixed and variable expenses?
    Fixed expenses stay the same each month (like rent), while variable expenses change (like groceries).
  • Define compound interest.
    Interest calculated on both the principal and the accumulated interest.
  • What is income?
    The money you receive from work, investments, or other sources.
  • Write the formula for simple interest.
    I = P × R × T ÷ 100.
  • . If you earn R8000 and your total monthly expenses are R6500, how much do you save?
    R1500.
  • . Calculate the simple interest on R1000 at 10% per annum for 2 years.
    I = 1000 × 10 × 2 ÷ 100 = R200.
  • Which earns more over time: simple or compound interest?
    Compound interest.
  • How does time affect simple interest?
    The longer the time, the higher the interest earned.
  • If R1000 grows to R1331 after 3 years, find the compound interest earned.
    CI = 1331 – 1000 = R331.
  • What does ‘principal amount’ mean?
    The original amount of money invested or borrowed.
  • If the simple interest on R4000 is R800 after 2 years, what is the rate of interest?
    R = (I × 100) ÷ (P × T) = (800 × 100) ÷ (4000 × 2) = 10%.
  • What is a budget deficit/shortfall?
    When expenses exceed income.
  • If you invest R500 at 8% compound interest for 3 years, what is the total amount?
    A = 500(1 + 8/100)^3 = 500(1.2597) = R629.85.
  • What is an expense?
    Money spent on goods and services.
  • Name two examples of good financial planning habits.
    Tracking expenses and saving regularly.
  • Why is budgeting important?
    It helps you manage money, avoid overspending, and achieve financial goals.
  • What does ‘interest rate’ mean?
    The percentage charged or earned on an amount of money over time.
  • Define simple interest.
    Interest calculated only on the principal amount for a period of time.
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