Financial Mathematics
You're viewing free preview questions — 4 questions previewing here — subscribe to unlock 86 more, plus the Full Question Bank, Mock Papers & Worksheets.Upgrade

Financial Mathematics — Free MYP5 Mathematics (Standard) Practice Questions

1QuestionCurrency Conversion and Exchange RatesConcept Practice
4 marks~6 minCriterion A
A tourist exchanges British pounds (GBP) at a currency kiosk displaying the following rates:

1 GBP=1.27 USD1 \text{ GBP} = 1.27 \text{ USD}
1 GBP=1.15 EUR1 \text{ GBP} = 1.15 \text{ EUR}
1 GBP=1.68 AUD1 \text{ GBP} = 1.68 \text{ AUD}
a
State the exchange rate from GBP to USD. [1]
b
Calculate the number of USD the tourist receives for 350 GBP. [1]
c
The tourist plans to travel to both the United States and the eurozone. She decides to exchange all 350 GBP into whichever single currency gives more foreign currency units. Justify which currency she should choose, supporting your answer with calculations. [2]
Question diagram

Solutions

2QuestionCurrency Conversion and Exchange RatesAssessment Practice
3 marks~5 minCriterion D
A student in the UK plans a 10-day trip to Japan with a budget of 2000 GBP. They use the exchange rate model:

Amount in JPY=Amount in GBP×156.4\text{Amount in JPY} = \text{Amount in GBP} \times 156.4

When converting at the bank, a fee of 2.5% and a spread of 0.5% are applied, reducing the effective amount received.
a
Calculate the total amount in JPY the student receives after the bank applies the fee and spread. [1]
b
Calculate the student's daily budget in JPY, assuming equal spending over 10 days. [1]
c
Typical daily expenses in Tokyo average 35,000 JPY. Advise the student whether their current GBP budget is sufficient for the trip, justifying your answer with reference to your calculated daily figure. [1]
Question diagram

Solutions

3QuestionProfit Loss and Discount CalculationsConcept Practice
2 marks~3 minCriterion B
A retailer offers a bulk-purchase discount scheme:

Number of items purchased123
Discount applied3%3\%6%6\%9%9\%
a
Deduce the general rule for the discount percentage when nn items are purchased. [1]
b
A customer needs a discount of at least 12%12\% to stay within budget. Justify whether purchasing 4 items meets this requirement, using your rule from part (a). [1]

Solutions

4QuestionSolving Real-World Finance ProblemsAssessment Practice
4 marks~6 minCriterion C
Maria borrows 12 000 dollars at a compound interest rate of 6% per annum, compounded annually. The loan balance at the end of each year is shown below.

Year 0: 12 000.00 dollars
Year 1: 12 720.00 dollars
Year 2: 13 483.20 dollars
Year 3: 14 292.19 dollars
Year 4: 15 149.72 dollars
a
State the values of PP, rr, and nn in the formula A=P(1+r)nA = P(1 + r)^n that represent this loan over the full 4-year period. [1]
b
Calculate the total amount owed after 4 years using the formula A=P(1+r)nA = P(1 + r)^n. [1]
c
Maria claims she can afford this loan because "the interest charged each year stays the same." Advise Maria on whether her claim is correct, using numerical evidence from the table and explaining what the pattern of annual interest charges means for her repayment burden. [2]
Question diagram

Solutions

Questions 5-90

Unlock these questions with Premium

Sign Up →

That's every free question here — 4 of 90.

+86 more questions, plus Mock Papers & Worksheets, are waiting in Premium.

Upgrade