Cima C03 Study Guide Notes

C03Fundamentals of Business Mathematics

C03 Fundamentals of Business Mathematics

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C03 Fundamentals of Business Mathematics

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How CIMA benefit your Business

Analysis - Understanding the history behind numbers and use it to make business decisions

Strategy Using the insight from analysis to help formulate business strategy to create wealth and shareholder value.

Risk - The application of analytical skills to observe business processes end end a pair identify and manage risks.

Planning using accounting techniques to plan and budget.

Communication knowing what information management needs and explaining the numbers to non-financial managers.

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Question No 1:

A retailer buys a box of a product, which nominally contains Q units. The planned selling price of each unit is P. If both P and Q have been rounded to 10%, then the maximum rounding error in total revenue is

A. 10% B. 20% C. 21% D. 01Q x 01P


Question No 2:

The telephone costs of a company last year were 10,000, including Value Added Tax (VAT) at 175%. It has been decided to allocate 60% of these telephone costs, excluding VAT, to Central Administration and to allocate 30% of the remainder, excluding VAT, to Finance. The telephone costs (to the nearest ) to be allocated to Finance will be closest to

A. 10% B. 20% C. 21% D. 01Q x 01P


Question No 3:

The following formula is used in the financial analysis of dividends: R= (V/P)+G When the formula is rearranged, with P in terms of the other variables, P is equal to

A. (R/V)-G B. (R-G)/V C. (V/R)-G D. V/R-G


Question No 4:

A companys market value has fallen from 32 billion to 2 billion in four years. The average annual percentage decline in market value is closest to

A. 20%. B. 40%. C. 50%. D. 100%.


Question No 5:

If 3x + 2y = 6 and x 2y = 2. The solution, in the form (x,y), to the above simultaneous equations is

CBA Model Question Paper CO3


Question No 6:

The estimated total cost of each unit of a product is 12 ( 1), and the estimated selling price of each unit is 20 ( 3). The estimated profit per unit will be

A. 8 ( 4) B. 8 ( 3) C. 8 ( 2) D. 8 ( 1)


Question No 7:

A traders weekly costs, TC, are less than or equal to $100. Weekly revenue, R, is a minimum of $120. Which ONE of the following statements is true?

A. TC < $100 and R > $120 and R > TC B. TC $100 and R $120 and TC > R C. TC $100 and R > $120 and R < TC D. TC $100 and R $120 and R > TC


Question No 8:

In a group of 100 players, 30 are male, 55 are at pro level, and 6 of the males are at beginner level. A player chosen at random is female. What is the probability that she is not at pro level.

A. 80 B. 56 C. 44 D. 20


Question No 9:

Three people are carrying out independent functions during an internal audit. It is known that in each of the three separate areas being investigated there is a serious error. From past experience, it is estimated that the (independent) chances of the individuals finding the serious error in their area are 08, 07 and 06. The probability that at least one of the serious errors will be found is

A. (08 x 03 x 04) + (02 x 07 x 04) + (02 x 03 x 06) B. 1 (02 x 03 x 04) C. 1 (08 x 07 x 06) D. none of the above.


Question No 10:

The number of daily complaints to a railway company has an average (arithmetic mean) of 12 and a standard deviation of 3 complaints. The coefficient of variation, measured as a percentage, is therefore

A. 025%. B. 4%. C. 25%. D. 400%.


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