Adventure Novel Pricing Quiz
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Questions and Answers

What is the difference between the marked price and the selling price of the adventure novel in the story?

  • 20 rupees (correct)
  • 10 rupees
  • 40 rupees
  • 30 rupees

    • What is the percentage discount Ethan and George received on the adventure novel?

  • 10%
  • 20% (correct)
  • 15%
  • 25%

    • If Ethan sells the book to the scrap dealer for 90 rupees, how much profit will he make?

  • 30 rupees
  • 40 rupees
  • 10 rupees (correct)
  • 20 rupees

    • What is the selling price of the book when Ethan sells it to the scrap dealer for 50 rupees?

    <p>50 rupees (A)</p> Signup and view all the answers

    What would Ethan's profit be if he sold the book for 90 rupees to the scrap dealer given he bought it for 80 rupees?

    <p>10 rupees (B)</p> Signup and view all the answers

    What is the cost price of the adventure novel in the story?

    <p>Not mentioned in the text (A)</p> Signup and view all the answers

    What is the loss Ethan experiences when he sells the book to the scrap dealer for 50 rupees?

    <p>30 rupees (C)</p> Signup and view all the answers

    What is the formula for calculating profit?

    <p>Selling price - cost price (C)</p> Signup and view all the answers

    What is the difference between the marked price and the selling price?

    <p>The marked price is the original price of an item, and the selling price is the price at which it is sold after a discount. (C)</p> Signup and view all the answers

    What is the profit in a transaction?

    <p>The difference between the selling price and the cost price. (B)</p> Signup and view all the answers

    In the story, what did Ethan and George learn about discounts?

    <p>Discounts can help customers save money and sometimes result in profit. (B)</p> Signup and view all the answers

    If a book is marked at Rs. 150 and a 10% discount is offered, what is the selling price of the book?

    <p>Rs. 135 (D)</p> Signup and view all the answers

    What is the cost price of an item?

    <p>The price at which an item is bought by a retailer. (B)</p> Signup and view all the answers

    What is the main message of the story about Ethan and George?

    <p>It is important to understand the basics of financial literacy to make informed decisions. (C)</p> Signup and view all the answers

    Why did Ethan and George feel accomplished after buying the book?

    <p>They had successfully applied the knowledge gained, in a real-world scenario (A), They had succeeded in negotiating a better price. (C)</p> Signup and view all the answers

    What is '4.__________________ is one of the major source of borrowing' referring to? (Choose the best answer)

    <p>A financial institution (C)</p> Signup and view all the answers

    Which of these scenarios would be best suited for simple interest calculation?

    <p>Determining the amount of interest earned on a savings account with a fixed interest rate. (B)</p> Signup and view all the answers

    If a principal amount of $1000 is invested at a simple interest rate of 5% for 3 years, what will the total amount be?

    <p>$1150 (D)</p> Signup and view all the answers

    What is the primary purpose of adjusting the time period in simple interest calculations?

    <p>To align the time period with the frequency of interest payments. (C)</p> Signup and view all the answers

    Which of the following is an accurate statement about simple interest?

    <p>It is a basic form of interest calculation that is often used for short-term loans and investments. (D)</p> Signup and view all the answers

    For a simple interest calculation, suppose the time period is 18 months. What is the adjusted time period in years?

    <p>1.5 (B)</p> Signup and view all the answers

    If Ethan borrowed 500 rupees from George for 2 years at an interest rate of 8% per annum, how much simple interest would Ethan need to pay back?

    <p>160 rupees (D)</p> Signup and view all the answers

    If Ethan had invested 1000 rupees at a simple interest rate of 5% per annum for 3 years, how much would his total investment be worth at the end of the third year?

    <p>1150 rupees (A)</p> Signup and view all the answers

    Ethan and George's lemonade stand earned a profit of 20 rupees on their initial investment of 100 rupees. They kept the stand operating for 3 months. What is the annual interest rate they earned on their investment? (Hint: Consider the time period in months.)

    <p>120% (C)</p> Signup and view all the answers

    If Ethan invested 750 rupees at a 6% per annum simple interest rate, how long would it take for his investment to grow to 1050 rupees?

    <p>4 years (D)</p> Signup and view all the answers

    George borrowed 2000 rupees from his father at a simple interest rate of 4% per annum for 5 years. How much interest will George have to pay back at the end of 5 years?

    <p>800 rupees (D)</p> Signup and view all the answers

    Ethan invested 1500 rupees in a savings account that earns simple interest at a rate of 3% per annum. After 4 years, what would be the total amount in his account?

    <p>1680 rupees (C)</p> Signup and view all the answers

    If a loan of 1000 rupees is taken at a simple interest rate of 7% per annum for 3 years, what is the total amount to be paid back at the end of the loan period?

    <p>1210 rupees (C)</p> Signup and view all the answers

    A loan of 5000 rupees is taken at a simple interest rate of 10% per annum for 2 years. What is the total amount of interest to be paid on this loan?

    <p>1000 rupees (C)</p> Signup and view all the answers

    What is the initial investment amount in Ethan and George's lemonade stand business?

    <p>100 rupees (C)</p> Signup and view all the answers

    What was Ethan and George's profit from their lemonade stand?

    <p>20 rupees (A)</p> Signup and view all the answers

    How did Ethan and George calculate their interest rate?

    <p>They divided the profit by the principal amount and multiplied by 100. (C)</p> Signup and view all the answers

    What is the time period Ethan and George used to calculate their interest?

    <p>They converted the number of weeks into a fraction of a year. (C)</p> Signup and view all the answers

    How much simple interest did Ethan and George earn?

    <p>10 rupees (C)</p> Signup and view all the answers

    Why is simple interest considered a 'basic form of interest calculation'?

    <p>Because it only takes into account the principal amount, interest rate, and time period. (B)</p> Signup and view all the answers

    What is the main reason Ethan and George are thrilled by their findings?

    <p>They realized the importance of simple interest in making financial decisions. (D)</p> Signup and view all the answers

    What inspired Ethan and George to expand their business and explore new investments?

    <p>They wanted to earn more profit and expand their lemonade stand business. (B)</p> Signup and view all the answers

    If a loan of 1,000 rupees is taken out at an interest rate of 5% per annum for 4 years, what is the simple interest accrued?

    <p>200 rupees (B)</p> Signup and view all the answers

    A sum of 500 rupees is invested at a simple interest rate of 7% per annum for 3 years. What is the total amount at the end of the period, including the interest?

    <p>605 rupees (D)</p> Signup and view all the answers

    A person borrows 800 rupees at a simple interest rate of 10% per annum. If he pays back the loan and interest after 2 years, how much total amount will he pay back to the lender?

    <p>960 rupees (D)</p> Signup and view all the answers

    An investment of 1,500 rupees earns a simple interest of 14% per annum. How much interest will the investment earn after 5 years?

    <p>1,050 rupees (A)</p> Signup and view all the answers

    If a certain sum of money becomes five times itself in 20 years at simple interest, what is the annual rate of interest?

    <p>20% (C)</p> Signup and view all the answers

    A loan of 2,000 rupees is taken at a simple interest rate of 9% per annum. After how many years will the total amount due become 2,900 rupees?

    <p>5 years (C)</p> Signup and view all the answers

    The simple interest on a sum of money at 5% per annum for 3 years is 450 rupees. What is the sum of money?

    <p>3,000 rupees (A)</p> Signup and view all the answers

    A person borrows 1,000 rupees at a simple interest rate of 6% per annum. At the end of 2 years, he pays back 600 rupees. How much money does he still owe?

    <p>520 rupees (A)</p> Signup and view all the answers

    Flashcards

    Marked Price

    The original price of an item, shown on a tag.

    Discount

    A reduction on the marked price of an item.

    Selling Price

    The price at which an item is sold to customers.

    Cost Price

    The price at which an item is bought by the seller.

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    Profit

    The amount earned when selling price exceeds cost price.

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    20% Discount on 100

    Price after a 20% discount on a marked price of 100 rupees.

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    Profit Calculation

    Calculating profit as selling price minus cost price.

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    Savvy Shopper

    A consumer skilled at finding good deals and discounts.

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    Simple Interest

    Interest calculated only on the principal amount.

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    Principal Amount

    The initial sum of money invested or borrowed.

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    Interest Rate

    The percentage used to calculate interest earned or owed.

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    Time Period Adjustments

    Modifying the time frame in interest calculations.

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    Simple Interest Formula

    Used to calculate simple interest: I = P * r * t.

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    Loss

    When the selling price is less than the cost price of the item.

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    20% Discount

    A reduction of 20% from the marked price of 100 rupees.

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    Selling to scrap dealer

    If sold for less than the cost, it results in a financial loss.

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    Time Period

    The duration for which interest is calculated, usually in years.

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    Total Amount

    The sum of principal and simple interest earned over time.

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    Simple Interest Characteristics

    A fixed calculation that does not compound over time.

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    Adjusting Time Period

    Convert time units into years for correct calculations.

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    Use Cases of Simple Interest

    Used to determine amounts paid on loans or earned on investments.

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    Interest Calculation

    The process of determining how much interest has been earned or paid.

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    Total Interest Earned

    The total amount earned from the investment, based on simple interest.

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    Investment Opportunity

    An option where money can be put to earn returns.

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    Convert Interest Rate

    Changing the interest rate percentage into a decimal by dividing by 100.

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    Calculate Simple Interest

    The formula is Simple Interest = Principal Amount × Interest Rate.

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    Adjust Time Period

    Converting the time period into years if necessary for calculations.

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    Total Interest

    Total interest earned is calculated as Total Interest = Simple Interest × Time Period.

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    Study Notes

    Borrowing

    • Businesses require significant funds for large-scale operations.
    • Borrowing from external sources is often necessary to mitigate risks of using personal funds solely.
    • Borrowing allows businesses to handle daily operations, invest in equipment, and prepare for emergencies.
    • Common sources of borrowing include banks, financial institutions, government programs, and personal contacts.
    • Banks provide various loan types to meet diverse business needs.
    • Financial institutions offer specialized financial assistance.

    Meaning of Borrowing

    • Borrowed funds (loans) differ from a business's own funds (equity).
    • Borrowing involves acquiring funds from external sources.
    • An example is a businessman starting a skincare product business who needs funds but doesn't want to use all his savings, so he borrows from a bank.
    • The loan allows the business to start while protecting personal finances.

    Need for Borrowing

    • Starting a Business: Borrowing provides initial capital for operations.
    • Expansion and Growth: Businesses utilize loans to expand operations, invest in R&D, or establish new branches.
    • Daily Operations: Borrowing enables smooth daily operations by securing funds for payroll and raw materials.
    • Investments: Borrowed funds facilitate crucial investments in equipment or property.
    • Emergency Preparedness: Borrowing acts as a safety net during economic hardship or unforeseen events.

    Sources of Borrowing

    • Banks are major and convenient sources for borrowing capital.
    • Financial institutions specialize in providing financial assistance.
    • Government programs offer financial aid to small and micro-enterprises.
    • Family and friends can be informal sources, offering personalized support.

    Loan Principle and Interest

    • The principle amount is the actual sum of money borrowed.
    • Interest is a fee for borrowing, usually a percentage of the loan principle.
    • Repaying a loan includes both the principle and interest.

    Things to Remember

    • Borrowing funds is obtaining external financing to meet business needs.
    • Businesses need funding for new ventures, expansion, operational expenses, investments, and contingencies.
    • Common sources include banks, financial institutions, government programs, and personal contacts.
    • Crucial to consider the principle amount and interest when borrowing.
    • Responsible borrowing is essential for maintaining financial stability.

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    Chapter 6: Borrowing PDF

    Description

    Test your understanding of pricing concepts in the adventure novel story. This quiz covers topics such as marked price, selling price, profit calculations, and discount percentages. Challenge yourself with questions based on Ethan and George's experiences and learn key financial concepts along the way.

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