Bank Exams Questions

Q:

A loan shark made a loan of $100 to be repaid with $120 at the end of one month. What was the annual interest rate?

A) 210% B) 220%
C) 230% D) 240%
 
Answer & Explanation Answer: D) 240%

Explanation:

r=I/PT

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Q:

A mixture of 150 liters of wine and water contains 20% water. How much more water should be added so that water becomes 25% of the new mixture ?

A) 5 lit B) 10 lit
C) 15 lit D) 20 lit
 
Answer & Explanation Answer: B) 10 lit

Explanation:

Number of liters of water in 150 liters of the mixture = 20% of 150 = 20/100 x 150 = 30 liters.
P liters of water added to the mixture to make water 25% of the new mixture.
Total amount of water becomes (30 + P) and total volume of mixture is (150 + P).
(30 + P) = 25/100 x (150 + P)
120 + 4P = 150 + P => P = 10 liters.

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Q:

A merchant receives an invoice for a motor boat for $20 000 with terms 4/30, n/100. What is the highest simple interest rate at which he can afford to borrow money in order to take advantage of the discount?

A) 247.67 B) 237.67
C) 227.67 D) 215.67
 
Answer & Explanation Answer: A) 247.67

Explanation:

Suppose the merchant will take advantage of the cash discount of 4% of $20 000 = $800 by paying the bill within 30 days from the date of invoice. He needs to borrow $20 000 = $800 = $19 200. He would borrow this money on day 30 and repay it on day 100 (the day the original invoice is due) resulting in a 70-day loan. The interest he should be willing to pay on borrowed money should not exceed the cash discount $800.

r=I/pt=21.73%

The highest simple interest rate at which the merchant can afford to borrow money is 21.73%. This is a break-even rate. If he can borrow money, say at a rate of 15%, he should do so. He would borrow $19 200 for 70 days at 15%. Maturity value of the loan is $19 200(1+0.15(70/365))=$19 752.33

savings would be $20 000 − $19 752.33 = $247.67

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Q:

Three of the following four are alike in certain way and hence form a group. Which one of the following does not belong to that group ?

A) BHF B) LDJ
C) OKG D) ZTY
 
Answer & Explanation Answer: C) OKG

Explanation:

OKG
Remaining all are not in series
only OKG is in series of(15,11,7)

Here it follows the random difference of '4'.

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Q:

What letter will come in place of question mark ?

L    J    H

J    P    D

P    ?    E

A) K B) L
C) P D) I
 
Answer & Explanation Answer: D) I

Explanation:

Sum of place value in a row is 30.

So the letter which comes in place of '?' is 'I'

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