NAT12 MOCK EXAM IN MATHEMATICS

I. Choose the best answer that satisfies the questions. Encircle the letter of your answer.

1. What interest remains constant throughout the investment term?

A. Simple B. Compound C. Annuity Due D. Ordinary Annuity
2. It is an interest computed based on the principal amount.
A. Simple B. Compound C. Annuity Due D. Ordinary Annuity
3. Which of the following formula can be used to solve for the simple interest?
A. I = Prt B. SI = Prt/100 C. A= P (1 + rt) D. All of the above
4. In the formula, I= Prt, what is r?
A. Revenue B. Real Value C. Repaid D. Rate of interest
5. Which of the following describes time or term?
A. It is the date on which money is received by the borrower.
B. It is the amount paid or learned for the use of money.
C. It is the date of which the money borrowed or loan is to be completely repaid.
D. It is the amount of time in years the money is borrowed or invested; length of time between the
origin and maturity dates.
6. Which interest is computed on the principal and then added to it?
A. Simple B. Compound C. Annuity Due D. Ordinary Annuity
7. Compound interest is favorable to the following except?
A. investor of a retirement fund C. investor of stocks
B. person who saves in bank D. borrower of a loan
8. The interest from the previous year also earns interest, which of the following describes the statement?
A. Simple B. Compound C. Rate D. Time
9. The following statements are true EXCEPT:
A. The amount invested to a compounded interest yields to greater maturity value than to a simple interest.
B. The amount borrowed from a simple interest yields to a smaller maturity value than a compound interest.
C. The simple interest yields interest only from initial principal amount.
D. The interest in a compound account yield interest only from initial principal amount.
10. Which of the following will yield a higher interest?
A. Investing in a bank that offers a simple interest rate of 10%annually for 2 years.
B. Investing in a cooperative that offers an interest rate of 10%compounding annually for 2 years.
C. Saving money in a piggy bank for 2 years.
D. Both a and b
11. If the investment amounting to ₱35,000 earned an interest of ₱2,500 how much will be the maturity value?
A. ₱32,500 B. ₱37,500 C. ₱30,000 D. ₱40,000
12. What is the frequency of conversion if the annual rate is compounded quarterly?
A. 2 B. 3 C. 4 D. 12
13. What will you get if you divide the simple interest by the product of the rate and time?
A. present value of compound interest
B. present value of simple interest
C. maturity value of compound interest
D. maturity value of simple interest
14. Given that P = ₱5,250, r = 1.25% and t = 5 years, find the simple interest.
A. ₱32,812.50 B. ₱3,281.25 C. ₱328.13 D. ₱32.82
15. Given that P = ₱10,500, r = 4 1 2 % and t = 8 months, find the simple interest.
A. ₱315 B. ₱3,150 C. ₱3,780 D. ₱31,500

For numbers 16-20, use the situation below.

Michael borrowed money from Castañas Cooperative Bank at 1.75% simple interest for 5 years to add to his
funds for his new business. It was charged ₱ 5,250.00 for interest.

16. What formula will be used to determine the amount of borrowed money?
Is F
A. I s=Prt B. P= C. I c =F( 1+ j)n d. P= t
rt ( 1+ r)
17. How much money will Michael add on his funds for his new business?
A. ₱ 459.38 B. ₱ 4,593.75 C. ₱ 6,000.00 D. ₱ 60,000.00
18. How much will he need to pay after 5 years?
A. ₱ 5,709.38 B. ₱ 9,843.75 C. ₱ 11,250.00 D. ₱ 65,250.00
19. If Michael borrowed the same amount of money payable for the same number of years and Castañas Cooperative
Bank offered a promo as part of its anniversary celebration and make all the interest loans 1.25%, how much interest
must be paid?
A. ₱ 3,750.00 B. ₱ 37,500.00 C. ₱ 63,750.00 D. ₱ 70,000.00
20. How much will he need to pay after 6 years if he availed the promo?
A. ₱ 64,500.00 B. ₱ 65,250.00 C. ₱ 70,000.00 D. ₱ 74,500.00
21. What is referred to as a fixed sum of money paid to someone at regular intervals, subject to a fixed compound
interest rate?
A. Compound Interest B. Simple Interest C. Annuity d. Annuity Certain
22. What type of annuity is illustrated when the interest conversion or compounding period is equal or the same as the
payment interval?
A. Annuity Certain B. Annuity Uncertain C. Simple Annuity D. General Annuity
23. What type of annuity is illustrated when the interest conversion or compounding period is unequal or not the same
as the payment interval?
A. Annuity Certain B. Annuity Uncertain C. Simple Annuity D. General Annuity
24. Which is an example of annuities?
A. interest B. rent C. bills D. savings
25. Which of the following is NOT an example of annuities?
A. Pension B. educational plan C. car loan D. deposit
26. A payment made at the end of each month for money borrowed that charges 1.05% interest compounded quarterly.
What type of annuity is being represented?
A. Simple B. General C. Ordinary D. Annuity Due
27. What type of annuity is represented by a deposit of ₱ 6,000.00 that is made at the end of every three months to an
account that earns 5.6% interest compounded quarterly?
A. Simple B. General C. Ordinary D. Annuity Due
28. Which of the following situations is an example of a simple annuity?
A. ₱ 2,000 deposited every six months for 2 years at 8% per year compounded monthly.
B. ₱ 2,000 deposited every month for 2 years at 8%per year compounded annually.
C. ₱ 2,000 deposited every month for 2 years at 8%per year compounded monthly.
D. ₱ 2,000 deposited every quarter for 2 years at 8%per year compounded monthly.
29. Which of the following situations is an example of a general annuity?
A. ₱ 5,000 deposited every month for 5 years at 8%per year compounded annually.
B. ₱ 5,000 deposited every six months for 5 years at 8%per year compounded semi-annually.
C. ₱ 5,000 deposited every three months for 5 years at 8%per year compounded quarterly.
D. ₱ 5,000 deposited every year for 5 years at 8%per year compounded annually.
30. Which of the following situations is NOT an example of simple annuity?
A. ₱1,500 deposited every month for 15 years at 10%per year compounded annually.
B. ₱1,500 deposited every month for 15 years at 10%per year compounded monthly.
C. ₱1,500 deposited every six months for 15 years at 10%per year compounded semi-annually.
D. ₱1,500 deposited every three months for 15 years at 10%per year compounded quarterly.
31. What is the sum of present values of all the payments to be made during the entire term of the annuity?
A. Present Value of an Annuity C. Periodic Payment
B. Future Value of an Annuity D. Term of an Annuity
32. What is the sum of future values of all the payments to be made during the entire term of the annuity?
A. Periodic Payment C. Present Value of an Annuity
B. Payment Interval D. Future Value of an Annuity
33. Find the future value of an annuity of ₱ 10,000.00 payable quarterly for 3 years if money is worth 12%
compounded monthly.
A. ₱ 33,596.60 B. ₱ 33,695.60 C. ₱ 33,965.60 D. ₱ 33,956.60
34. What is the present value of the simple annuity of ₱ 5,000.00 payable semiannually for 10 years if money is worth
6% compounded semi-annually?
A. ₱ 74,387.37 B. ₱ 67,200.42 C. ₱ 81,600.96 D. ₱ 34,351.87
35. Find the present value of an annuity of ₱20,000.00 payable semi-annually for 5 years if money is worth 6% per
year compounded quarterly.
A. ₱120,640.00 B. ₱ 145,022.80 C. ₱ 170,408.33 D. ₱186,640.00
36. It is the money that is earned in trade or business after paying the costs of producing and selling goods and
services.
A. Stock B. Profit C. Bond D. Investment
37. A person or an entity that gives money or allocates capital with the expectation of receiving financial returns.
A. Entrepreneur B. Stockbroker C. Politician D. Investor
38. A business formed to manufacture or supply products or services for profit.
A. Stock B. Company C. Stockbroker D. Bond
39. What is a bond?
A. A certificate of ownership in a corporation, with the right to a share of the earnings.
B. A payment from an investor to a corporation for the rights to future profits.
C. A group of stocks sold together for a set price.
D. A certificate representing a loan from an investor to a corporation or government entity.
40. What is a stock dividend?
A. A capital gains.
B. The price the stock is sold for.
C. Part of the company’s profits that is paid to owners.
D. The price paid when stock is sold to an investment bank.
41. What is the best explanation of a bond?
A. It is an ownership interest in a company.
B. It is an equity or share in a company.
C. It represents a corporate or government debt obligation.
D. It is a debt instrument.
42. All of the following are reasons to buy bonds EXCEPT:
A. Bonds generally have outperformed the stock market over the last 100 years.
B. Bonds pay out interest at set intervals, allowing people to live off the income.
C. Bonds may outperform the stock market during certain periods of time.
D. Investing in bonds may generate less tax liability than investing in stocks.
43. When people buy stock on a stock market. They are considered as _________.
A. the people selling the stock receives the money.
B. the corporation loses money.
C. the corporation receives the money.
D. the people buying the stock receives the money.
44. An activity in which money is put at risk for the purpose of making a profit.
A. Invest B. Sell C. Buy D. collect
45. A bond that pays all of its interest and principal at the bond’s maturity date.
A. Bond fund B. Par-value Fund C. Coupon Bond D. Zero-coupon Bond
46. Why would someone buy a bond instead of a stock?
A. It is a less risky investment.
B. To have ownership in a company.
C. It can yield a higher return on investment.
D. To receive dividend payments.
47. Which best defines the risk of a financial asset?
A. Investing in several different assets with unrelated risks.
B. The amount that will be repaid at the end of a bond’s term.
C. The probability that an asset will lose value.
D. The uncertainty that an asset might gain or lose value.
48. Why would someone choose to put money in stocks as opposed to a savings account that earns interest?
A. They are guaranteed a return in stocks.
B. There is a potential to earn more money in the stock market.
C. They are guaranteed a return in a savings account.
D. There is a potential to earn more money in the savings account.
49. Why do people buy stocks?
A. There is no chance of a loss.
 B. They expect to earn a return.
C. The government encourages them to buy stock.
D. They are guaranteed interest payment each year.
50. Several years ago, Company A issued bonds to raise funds so that it could buy equipment. Those bonds were
purchased by the Bank of the East. However, the Bank of the East has decided that it doesn’t want to have any assets
in the form of bonds, so it is selling off all the bonds that it owns. Which of the following is most likely to be the result
of this action?
A. The default risk of the bonds will increase.
B. Bond prices will increase.
C. The face value of the bonds will decrease.
D. Interest rates will increase.
51. Given f(x)= x-2 and g(x)= 5-2x. What is f(8) – g(5)?
A. -11 B. 11 C. -1 D. 1
52. Identify which of the following is a logarithmic equation?
A. y=log 2 ( x +3 ) +1 B. log (x¿¿ 3+ x−1)=5¿
1
C. log 7 (2 x + 4)>log 7 (1−x) C. g ( x )= ln ( 3 x+1 )−5
2
53. Which of the following is an exponential equation?
A. 2 x =16 B. f ( x )=2 x C. f ( x )=2x D. 16 x < 4
54. The y-intercept of the graph of f ( x )=22−x −2 is
A. 0 B. 1 C. 2 D. 3
55. Which of the following relation represents a one-to-one function?
A. age to student’s grade level B. a teacher to students
C. countries to its capital D. none
2
4x
56. Find the horizontal asymptote of the graph of rational function f ( x )= .
2 x+1
−1
A. 2 B. 1 C. D. none
2
57. Let f(x) = 2x – 5 and g(x) = x - , what is (g ° f)(x)?
A. 2x – 8 B. -2x + 2 C. 2 x 2−8 x+15 D. 2x – 11
58. Given: f(x) = 3x + 3; g(x) = 2x. Find (f * g)(x).
A. 2 x 2+12 x+ 6 B. 6 x 2+ 2 x +6
C. 6 x 2+ 6 x D. x 2+ 6 x+1
59. Let f(x) = x+7. Find f −1 (x) .
A. x 2−7 B. x 2+ 7 C. x+7 D. x-7
f (x )
60. Given f ( x )=9−x 2 and g ( x )=3−x . Find .
g (x)
A. x B. 3 – x C. 3 + x D. –(3+x)