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ECZ Grade 12 School Certificate Finance, growth and decay — practice questions

Explore 6 free Finance, growth and decay questions in ECZ Grade 12 School Certificate Mathematics. Open each question or exercise to read its content, reference answers and available explanation.

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Finance, growth and decay questions and exercises with answers

Showing questions 1–6 of 6.

Simple interest is worked out on which amount only?Read the answer and worked solution →What does the straight-line method of depreciation take off each year?Read the answer and worked solution →A sum of 5000 earns 8 percent a year in simple interest for 3 years. What is the accumulated amount?Read the answer and worked solution →A machine worth 8000 loses 25 percent a year on a reducing-balance basis. What is it worth after 2 years?Read the answer and worked solution →A sum of 1000 earns 10 percent a year, compounded once a year. What is it worth after 2 years?Read the answer and worked solution →Sort the two depreciation methodsRead the answer and worked solution →

Worked practice questions

Simple interest is worked out on which amount only?

  1. The interest earned
  2. The accumulated amount
  3. The remaining balance
  4. The principal amount
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Correct answer: D. The principal amount

1. The amount put in at the start is called the principal amount. 2. Simple interest is calculated only on that initial amount. 3. The interest earned is therefore the same in every year of the investment. 4. Compound interest is the other case, where earned interest also earns interest. _Source: Siyavula Mathematics Grade 11 (Everything Maths, CC BY 4.0), Chapter 9: Finance, growth and decay_

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What does the straight-line method of depreciation take off each year?

  1. A growing amount
  2. A shrinking amount
  3. A constant amount
  4. A doubling amount
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Correct answer: C. A constant amount

1. Depreciation is the loss in value of an asset over time. 2. In the straight-line method the value is reduced by a constant amount each year. 3. That amount is worked out on the principal amount every time, so it never changes. 4. A shrinking amount belongs to reducing-balance depreciation, which works on the reduced value instead. _Source: Siyavula Mathematics Grade 11 (Everything Maths, CC BY 4.0), Chapter 9: Finance, growth and decay_

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A sum of 5000 earns 8 percent a year in simple interest for 3 years. What is the accumulated amount?

  1. It is 5400
  2. It is 6000
  3. It is 6296
  4. It is 6200
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Correct answer: D. It is 6200

1. Simple interest is worked out only on the initial amount invested. 2. Eight percent of 5000 is 400, so 400 is earned in each year. 3. Over 3 years that gives 400 times 3, which is 1200. 4. The accumulated amount is the principal amount plus the interest earned. 5. So the final value is 5000 plus 1200, which is 6200. 6. Answering 5400 counts only one year of interest instead of three. _Source: Siyavula Mathematics Grade 11 (Everything Maths, CC BY 4.0), Chapter 9: Finance, growth and decay_

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