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Question 1Verbal Reasoning and Comprehension
In a verbal reasoning passage, a writer states: 'Although the committee approved the budget, it postponed the hiring of new staff.' What is the main contrast the sentence establishes?
- The committee rejected both the budget and the hiring plan.
- Budget approval occurred, but staff hiring was delayed. Correct answer.
- The committee approved hiring but postponed the budget.
- New staff were hired before the budget was approved.
Explanation
The conjunction 'although' signals contrast between two clauses. The first clause reports approval of the budget, while the second reports postponement of hiring, so the contrast is between approval and delay.
Question 2Verbal Reasoning and Comprehension
A report notes: 'The new procedure reduced processing errors by half; nevertheless, customer complaints rose slightly.' Which inference is best supported?
- Fewer errors do not automatically improve overall customer satisfaction. Correct answer.
- Customer complaints are a more reliable measure than processing errors.
- The new procedure caused customer complaints to rise.
- Processing errors were unrelated to the procedure.
Explanation
The word 'nevertheless' marks an unexpected result: errors fell while complaints rose. This supports only the cautious inference that error reduction alone did not guarantee improved satisfaction, not a causal claim.
Question 3Verbal Reasoning and Comprehension
Which word is the best synonym for 'meticulous' as used in a civil service appraisal: 'Her meticulous record-keeping impressed the auditors'?
- Rapid
- Occasional
- Reluctant
- Careful Correct answer.
Explanation
'Meticulous' means showing great attention to detail. In the context of record-keeping that impressed auditors, 'careful' captures that meaning most closely.
Question 4Verbal Reasoning and Comprehension
In the sentence 'The supervisor, who had reviewed the file, approved the request,' what is the grammatical function of 'who had reviewed the file'?
- An adverbial clause expressing the reason for approval
- A noun clause serving as the object of 'approved'
- A non-restrictive relative clause adding information about the supervisor Correct answer.
- A restrictive clause identifying which supervisor is meant
Explanation
The clause is set off by commas and begins with 'who', making it a non-restrictive relative clause. It adds descriptive information about the already-identified supervisor rather than narrowing down which supervisor.
Question 5Verbal Reasoning and Comprehension
A notice reads: 'Applications received after the deadline will not be considered, unless an extension has been granted in writing.' Which situation is clearly permitted?
- An applicant emails to request an extension after submitting late.
- An applicant submits on time but without written confirmation.
- An applicant submits late without any prior arrangement.
- An applicant with a written extension submits after the deadline. Correct answer.
Explanation
The exception clause permits late consideration only when a written extension has been granted. The first option matches both conditions: an extension exists and it is in writing.
Question 6Verbal Reasoning and Comprehension
A paragraph argues: 'All licensed inspectors must file annual reports. Ms. Tan is a licensed inspector. Therefore, Ms. Tan must file an annual report.' Which reasoning pattern does this follow?
- An appeal to authority based on Ms. Tan's position
- A false dilemma between filing and not filing
- Valid deductive reasoning from a general rule to a specific case Correct answer.
- Inductive generalization from specific cases to a general rule
Explanation
The argument applies a universal rule to an individual who meets its condition, producing a conclusion that necessarily follows. This is deductive reasoning, not generalization or a fallacy.
Question 7Verbal Reasoning and Comprehension
Which sentence uses 'affect' and 'effect' correctly in a civil service context?
- The new policy will affect how staff process claims, and its effect on delays is uncertain. Correct answer.
- The new policy will affect how staff process claims, and its affect on delays is uncertain.
- The new policy will effect how staff process claims, and its effect on delays is uncertain.
- The new policy will effect how staff process claims, and its affect on delays is uncertain.
Explanation
'Affect' is normally a verb meaning to influence, while 'effect' is normally a noun meaning a result. The first option uses 'affect' as the verb and 'effect' as the noun, which is correct.
Question 8Verbal Reasoning and Comprehension
A passage states: 'The agency's public consultation was well attended, but most attendees were employees of the agency itself.' What does this detail most likely suggest about the consultation?
- It was poorly organized and badly publicized.
- The agency had no interest in public feedback.
- Its claim to represent broad public input may be weakened. Correct answer.
- Employees were prohibited from attending future consultations.
Explanation
If most attendees were internal employees, the consultation may not reflect the views of the wider public it was meant to gather. The passage supports skepticism about representativeness, not claims about organization or intent.
Question 9Verbal Reasoning and Comprehension
Choose the option that best completes the analogy: 'Audit is to accuracy as rehearsal is to _____.'
- preparedness Correct answer.
- audience
- ticket
- venue
Explanation
An audit checks or improves accuracy, just as rehearsal checks or improves preparedness. The relationship is between an activity and the quality it develops or verifies.
Question 10Verbal Reasoning and Comprehension
A memo says: 'Staff should submit travel claims within ten working days of returning; claims submitted later require the director's signature.' What is required for a claim submitted on the fifteenth working day?
- Approval from the travel agency
- A second copy of the receipt
- Nothing beyond the standard form
- The director's signature Correct answer.
Explanation
Ten working days is the normal limit, and anything later triggers the stated exception. A claim on the fifteenth day is past the limit, so the director's signature is required.
Question 11Verbal Reasoning and Comprehension
Which revision best removes wordiness from this civil service sentence: 'In the event that a citizen submits a complaint, it is the responsibility of the officer to make a record of it.'?
- Should a citizen submit a complaint, it is the officer's responsibility to make a record.
- When a citizen complains, the officer must record it. Correct answer.
- If a citizen submits a complaint, it is the officer who is responsible for making a record of it.
- In the event a citizen submits a complaint, the officer is responsible for recording it.
Explanation
Concise writing replaces multi-word phrases such as 'in the event that' and 'it is the responsibility of' with direct verbs. The first option preserves the meaning while cutting redundant wording.
Question 12Verbal Reasoning and Comprehension
A paragraph begins: 'Far from being a minor administrative change, the reform altered how every department reported its spending.' What is the writer's attitude toward the reform?
- It emphasizes that the reform was significant and far-reaching. Correct answer.
- It dismisses the reform as trivial and unimportant.
- It expresses uncertainty about whether the reform occurred.
- It criticizes the reform for being too expensive.
Explanation
The phrase 'far from being a minor administrative change' explicitly rejects the idea that the reform was minor. The writer stresses its broad impact across all departments.
Question 13Verbal Reasoning and Comprehension
In the sentence 'Neither the manager nor the clerks were informed of the change,' which explanation of the verb 'were' is correct?
- It agrees with the nearer subject 'clerks', following the neither/nor rule. Correct answer.
- It is required because 'nor' always makes the verb plural.
- It is an error and should be 'was' because 'neither' is singular.
- It agrees with 'manager', which is the first subject.
Explanation
With 'neither...nor', the verb conventionally agrees with the subject nearer to it. Here the nearer subject is the plural 'clerks', so 'were' is appropriate.
Question 14Verbal Reasoning and Comprehension
A report claims: 'Our office handled 20 percent more cases this year than last year.' Which additional fact would most strengthen the claim that productivity improved?
- The number of staff remained the same in both years. Correct answer.
- More cases were closed without a final decision.
- The office moved to a larger building this year.
- The types of cases changed slightly between years.
Explanation
Productivity means output relative to input. If the same number of staff handled more cases, output per worker rose, which directly supports the productivity claim.
Question 15Verbal Reasoning and Comprehension
Which word best fits the blank: 'The ombudsman's report was _____; it examined every complaint without exception.'?
- exhaustive Correct answer.
- biased
- brief
- tentative
Explanation
The second clause says every complaint was examined without exception, which signals completeness. 'Exhaustive' means thorough and complete, matching that description.
Question 16Verbal Reasoning and Comprehension
A passage states: 'Only departments that submit quarterly reports qualify for discretionary funding. The Parks Department did not qualify.' What can be validly concluded?
- The Parks Department submitted quarterly reports but was rejected for another reason.
- Discretionary funding is unavailable to all departments.
- The Parks Department did not submit quarterly reports. Correct answer.
- All departments that submit quarterly reports qualify.
Explanation
The rule says submitting quarterly reports is necessary for qualifying. If the department did not qualify, it must have failed that necessary condition, so it did not submit the reports.
Question 17Verbal Reasoning and Comprehension
What is the primary purpose of the sentence 'Please note that the deadline has been extended to 30 June' in an official circular?
- To summarize the entire circular
- To inform recipients of a changed administrative deadline Correct answer.
- To request that recipients extend their own deadlines
- To complain about the original deadline
Explanation
The sentence announces a change to an administrative deadline so that recipients know the new date. Its function is informational, not a request, complaint, or summary.
Question 18Verbal Reasoning and Comprehension
A statement reads: 'If the form is incomplete, it will be returned.' The form was not returned. What follows logically?
- The form was never submitted.
- The form was complete but rejected.
- The form was returned for another reason.
- The form was not incomplete. Correct answer.
Explanation
This is a valid application of modus tollens: if incomplete then returned; not returned, therefore not incomplete. The other options introduce facts not entailed by the rule.
Question 19Verbal Reasoning and Comprehension
Which option best restates the sentence 'The committee did not reject the proposal' without changing its meaning?
- The committee postponed the proposal indefinitely.
- The committee approved the proposal unanimously.
- The committee allowed the proposal to proceed, at least for now. Correct answer.
- The committee rejected the proposal.
Explanation
Saying the committee did not reject the proposal means only that rejection did not occur; it leaves open whether the proposal was approved or merely allowed to continue. The cautious restatement preserves that limited meaning.
Question 20Verbal Reasoning and Comprehension
A reader encounters the sentence: 'The data, which had been collected over five years, were analyzed by the research team.' Which statement about the sentence is accurate?
- 'Data' is treated as plural, and the relative clause is non-restrictive. Correct answer.
- 'Data' is treated as singular, and the relative clause is restrictive.
- 'Data' is treated as singular, and the relative clause is non-restrictive.
- 'Data' is treated as plural, and the relative clause is restrictive.
Explanation
The verb 'were' shows that 'data' is treated as plural here. The clause 'which had been collected over five years' is set off by commas, so it is non-restrictive.
Question 21Verbal Reasoning and Comprehension
An applicant writes: 'I have extensive experience in customer service. I have worked in three call centers. I am confident I can handle difficult inquiries.' Which criticism of the paragraph is most accurate?
- It lists experience without linking it to the specific duties of the post. Correct answer.
- It fails to state the applicant's name.
- It uses too many technical terms for a general reader.
- It relies on statistical evidence that is not cited.
Explanation
The paragraph presents general experience and a self-assessment but does not connect them to particular requirements of the role. A stronger application would tie each claim to the advertised duties.
Question 22Verbal Reasoning and Comprehension
Which sentence correctly uses a semicolon in formal administrative writing?
- The review is complete; the findings will be published next week. Correct answer.
- The review is complete; and the findings will be published next week.
- The review is complete; which the findings will confirm next week.
- The review is complete; because the findings will be published next week.
Explanation
A semicolon can join two independent clauses that are closely related without a coordinating conjunction. The first option links two complete clauses correctly.
Question 23Verbal Reasoning and Comprehension
A passage argues: 'Every year, the department publishes fewer printed forms and more online forms. Therefore, paper use will continue to decline.' Which assumption does the argument depend on?
- The department will keep its current budget.
- The public prefers online forms to printed ones.
- Printed forms are more expensive than online forms.
- Online forms will not lead to comparable paper use elsewhere. Correct answer.
Explanation
The conclusion about declining paper use assumes that shifting to online forms actually reduces paper consumption overall. If online forms generated similar printing elsewhere, the conclusion would not follow.
Question 24Verbal Reasoning and Comprehension
In the sentence 'Having reviewed the evidence, the panel reached a decision,' what does the opening phrase modify?
- An unspecified reviewer
- The panel Correct answer.
- The evidence
- The decision
Explanation
A participial phrase at the start of a sentence should modify the subject of the main clause. Here the subject is 'the panel', which did the reviewing.
Question 25Verbal Reasoning and Comprehension
A supervisor writes: 'Your report was adequate, although it could have addressed the budget more thoroughly.' What is the tone of the comment?
- Neutral, offering no judgment at all
- Strongly approving with no reservations
- Mildly critical while acknowledging the work meets a basic standard Correct answer.
- Openly hostile and dismissive
Explanation
'Adequate' indicates the report meets a minimum standard, and the 'although' clause adds a specific criticism. Together they produce measured, mildly critical feedback rather than praise or hostility.
Question 26Verbal Reasoning and Comprehension
A civil service report states: 'The new records system reduced processing time by half, and client complaints fell sharply.' Which inference is best supported by this statement?
- The records system eliminated all client complaints.
- Processing time was the only factor clients cared about.
- Faster processing was accompanied by fewer client complaints. Correct answer.
- Client complaints fell because staff worked longer hours.
Explanation
The sentence reports two changes occurring together: processing time halved and complaints fell sharply. A careful reader may infer an association between the faster processing and the drop in complaints, but not a proven cause and certainly not elimination of complaints. Options claiming total elimination or a single cause go beyond what the text states.
Question 27Verbal Reasoning and Comprehension
In an official notice, which sentence uses the word 'principal' correctly?
- The delay was principal caused by a shortage of staff.
- The committee will principal the new policy next month.
- The principal reason for the delay was that staff principals were absent.
- The principal reason for the delay was a shortage of trained staff. Correct answer.
Explanation
'Principal' as an adjective means main or most important, so 'the principal reason' is correct usage. As a noun it refers to a leading person or a sum of money, and it is never a verb meaning to implement a policy. The adverb form needed in the last option is 'principally'.
Question 28Verbal Reasoning and Comprehension
A paragraph in a policy brief reads: 'The pilot scheme ran for six months in two districts. Uptake was high in both. The evaluation recommended nationwide rollout.' Which criticism of the reasoning is most relevant?
- The evaluation should have been conducted before the pilot began.
- The recommendation generalizes from a small, short pilot to the whole country. Correct answer.
- The paragraph does not define what a district is.
- The paragraph fails to state how many staff administered the pilot.
Explanation
The conclusion moves from two districts over six months to a nationwide rollout, which is a large generalization from a narrow sample and short period. That is the central weakness in the argument. Missing details such as staff numbers or definitions are secondary and do not by themselves undermine the inference.
Question 29Verbal Reasoning and Comprehension
Which option best restates 'Not all submissions met the formatting standard' while preserving its meaning?
- Some submissions did not meet the formatting standard. Correct answer.
- No submissions met the formatting standard.
- Every submission met the formatting standard.
- All submissions failed to meet the formatting standard.
Explanation
'Not all' means that at least one item falls outside the stated group, so some submissions failed the standard. It does not specify how many failed, which is why the weaker 'some' restatement is accurate. The other options make stronger claims about all or none that the original does not support.
Question 30Verbal Reasoning and Comprehension
A memo reads: 'Because the deadline falls on a public holiday, submissions received on the next working day will be treated as timely.' A citizen submits on the next working day. What follows?
- The submission must be resubmitted on a later date.
- The submission is late because the original deadline passed.
- The submission is treated as timely under the memo's rule. Correct answer.
- The memo does not apply because a holiday is involved.
Explanation
The memo explicitly states a conditional rule: if the deadline falls on a public holiday, then submissions on the next working day count as timely. The stated facts match the condition, so the consequence follows directly. No further judgment about lateness is permitted once the rule applies.
Question 31Verbal Reasoning and Comprehension
Which sentence uses 'comprise' in accordance with standard formal usage?
- The review team comprises five auditors and two legal advisers. Correct answer.
- Five auditors and two legal advisers comprise the review team's members.
- The review team comprises of five auditors and two legal advisers.
- The review team is comprised of five auditors and two legal advisers.
Explanation
In careful formal usage, 'comprise' means to consist of or to include, so the whole comprises the parts: the team comprises its members. It takes a direct object without 'of', and the passive 'is comprised of' is widely criticized in formal writing. The third option reverses the relationship awkwardly by adding 'members'.
Question 32Verbal Reasoning and Comprehension
A passage states: 'The office reduced paper use after installing double-sided printers. However, electricity consumption rose by 15 percent in the same period.' Which conclusion is best supported?
- Paper use and electricity use always move in opposite directions.
- Double-sided printing caused the rise in electricity use.
- The office should remove the double-sided printers.
- One environmental benefit coincided with an environmental cost. Correct answer.
Explanation
The passage presents a reduction in paper use alongside an increase in electricity consumption during the same period. The cautious conclusion is that a gain in one area coincided with a cost in another. The text does not establish causation, recommend removing printers, or support a general law about the two resources.
Question 33Verbal Reasoning and Comprehension
Which revision best combines these sentences into one clear formal sentence? 'The form was incomplete. The clerk returned it to the applicant.'
- Because the form was incomplete, the clerk returned it to the applicant. Correct answer.
- The form was incomplete, the clerk returned it to the applicant.
- The form was incomplete and the clerk returned it, to the applicant.
- The form being incomplete, returned it the clerk to the applicant.
Explanation
A subordinating conjunction such as 'because' links the cause and the action into one grammatical sentence with a clear logical relationship. It also avoids a comma splice, in which two independent clauses are joined by only a comma. The remaining options contain punctuation or word-order errors.
Question 34Verbal Reasoning and Comprehension
A supervisor writes: 'The draft was thorough; nevertheless, it omitted the cost estimates required by the template.' What is the function of 'nevertheless' here?
- It confirms that the second clause repeats the first.
- It introduces a cause for the thoroughness described.
- It signals that the second clause qualifies or contrasts with the praise in the first. Correct answer.
- It marks the second clause as a direct quotation.
Explanation
'Nevertheless' is a conjunctive adverb signalling concession: despite the positive point in the first clause, a limitation follows. It sets up contrast rather than cause, repetition, or quotation. Recognizing this helps a reader weigh praise against the stated shortcoming.
Question 35Verbal Reasoning and Comprehension
Which word best completes the sentence: 'The auditor's findings were _____, resting on documents that could not be verified.'?
- commendable
- exhaustive
- routine
- questionable Correct answer.
Explanation
The clause after the blank explains that the supporting documents could not be verified, which undermines confidence in the findings. 'Questionable' captures that doubt and fits the causal link signalled by 'resting on'. The other adjectives either praise the findings or describe their scope, none of which follows from unverifiable evidence.
Question 36Verbal Reasoning and Comprehension
A notice reads: 'Applicants who submit supporting documents after the interview will not be disqualified, provided the documents arrive within five working days.' An applicant submits documents three working days after the interview. What is the result?
- The applicant is disqualified because documents came after the interview.
- The applicant's status depends on whether the interview was recorded.
- The applicant must reapply because late documents are never accepted.
- The applicant is not disqualified because the documents arrived within the allowed period. Correct answer.
Explanation
The rule creates a safe harbour: late documents do not disqualify an applicant if they arrive within five working days. Three working days falls inside that window, so the exception applies. The other options either ignore the proviso or introduce conditions absent from the notice.
Question 37Verbal Reasoning and Comprehension
A paragraph argues: 'Every office that adopted the new filing code reported faster retrieval times. Therefore, adopting the code will make any office faster.' Which assumption does the argument rely on?
- The offices that adopted the code are representative of offices generally. Correct answer.
- The filing code was designed by the reporting offices themselves.
- Faster retrieval times are the only measure of office efficiency.
- Retrieval speed never varies with the volume of records.
Explanation
To move from evidence about the offices that adopted the code to a claim about any office, the argument must assume those offices resemble offices in general. If they were unusually well resourced or motivated, the generalization would fail. The other statements are neither necessary nor implied by the reasoning.
Question 38Verbal Reasoning and Comprehension
Which sentence places its modifier so that the meaning is clear and logical?
- Having reviewed the file, it was approved by the officer.
- Having reviewed the file, the application was approved by the officer.
- Having reviewed the file, the officer approved the application. Correct answer.
- Having reviewed the file, approval of the application was given.
Explanation
An introductory participial phrase should modify the subject of the main clause. Only the first option makes the officer the one who reviewed the file and approved the application. The others attach the phrase to the application or to an abstract noun, producing a dangling modifier.
Question 39Verbal Reasoning and Comprehension
In a formal submission, which sentence uses 'fewer' and 'less' correctly?
- The branch received less complaints and fewer correspondence this quarter.
- The branch received fewer complaints and fewer correspondence this quarter.
- The branch received less complaints and less correspondence this quarter.
- The branch received fewer complaints and less correspondence this quarter. Correct answer.
Explanation
'Fewer' is used with countable items such as complaints, while 'less' is used with mass or uncountable nouns such as correspondence. Only the first option pairs each word with the appropriate noun type. The others swap the words or use 'fewer' with an uncountable noun.
Question 40Verbal Reasoning and Comprehension
A report notes: 'Staff who attended the training scored higher on the compliance test. The training was voluntary.' Which interpretation is most cautious?
- The compliance test should be withdrawn as unreliable.
- Higher scores are associated with attendance, but self-selection may explain part of the difference. Correct answer.
- Staff who skipped the training were less capable employees.
- The training definitely caused the higher compliance scores.
Explanation
Because attendance was voluntary, those who attended may already have been more motivated or knowledgeable, so the comparison is confounded by self-selection. The cautious reading notes the association while acknowledging that the training may not be the sole cause. Asserting definite causation or judging non-attendees' ability goes beyond the evidence.
Question 41Numerical Reasoning and Quantitative Analysis
A civil service recruitment notice states that 3 clerks can process 180 applications in 4 hours. At the same rate, how many applications will 5 clerks process in 6 hours?
- 540
- 420
- 450 Correct answer.
- 360
Explanation
One clerk processes 180 ÷ 3 ÷ 4 = 15 applications per hour. Five clerks working 6 hours therefore handle 15 × 5 × 6 = 450 applications. Keeping the rate per clerk-hour constant is the key step.
Question 42Numerical Reasoning and Quantitative Analysis
A departmental budget of 48,000 units is divided among three units in the ratio 2 : 3 : 5. How much does the largest share exceed the smallest share?
- 24,000 units
- 19,200 units
- 14,400 units Correct answer.
- 9,600 units
Explanation
The ratio has 2 + 3 + 5 = 10 parts, so each part is 48,000 ÷ 10 = 4,800 units. The largest share is 5 × 4,800 = 24,000 and the smallest is 2 × 4,800 = 9,600; the difference is 14,400 units.
Question 43Numerical Reasoning and Quantitative Analysis
A candidate scores 72, 85, 68, 90 and 80 on five written papers. What is the mean score?
- 79 Correct answer.
- 78
- 81
- 80
Explanation
The total of the five scores is 72 + 85 + 68 + 90 + 80 = 395. Dividing by the number of papers gives 395 ÷ 5 = 79. The mean is the arithmetic average, so no weighting applies here.
Question 44Numerical Reasoning and Quantitative Analysis
A public office clock shows 3:30. What is the angle between the hour hand and the minute hand?
- 105 degrees
- 90 degrees
- 75 degrees Correct answer.
- 60 degrees
Explanation
At 3:30 the minute hand points at 6 (180 degrees from 12) and the hour hand sits halfway between 3 and 4, at 105 degrees. The difference is 180 − 105 = 75 degrees.
Question 45Numerical Reasoning and Quantitative Analysis
A recruitment form requires each applicant to list a four-digit identification code using digits 1, 2, 3 and 4, each used exactly once. How many different codes are possible?
- 12
- 256
- 16
- 24 Correct answer.
Explanation
Arranging four distinct digits with each used once is a permutation: 4 × 3 × 2 × 1 = 24. The order matters because different arrangements form different codes.
Question 46Numerical Reasoning and Quantitative Analysis
A file contains 240 pages. A clerk completes 15 percent on the first day. How many pages remain?
- 216
- 204 Correct answer.
- 36
- 200
Explanation
Fifteen percent of 240 is 0.15 × 240 = 36 pages completed. Subtracting from the total gives 240 − 36 = 204 pages remaining.
Question 47Numerical Reasoning and Quantitative Analysis
An office purchased 12 identical chairs for a total of 9,600 units. What is the cost of 7 such chairs at the same unit price?
- 4,800 units
- 5,600 units Correct answer.
- 5,400 units
- 6,400 units
Explanation
The unit price is 9,600 ÷ 12 = 800 units per chair. Seven chairs therefore cost 7 × 800 = 5,600 units.
Question 48Numerical Reasoning and Quantitative Analysis
What is the simple interest on a training fund of 25,000 units at 8 percent per annum for 2 years?
- 2,000 units
- 5,000 units
- 4,000 units Correct answer.
- 4,500 units
Explanation
Simple interest equals principal × rate × time, so 25,000 × 0.08 × 2 = 4,000 units. Interest is charged only on the original principal each year.
Question 49Numerical Reasoning and Quantitative Analysis
A train 200 metres long passes a signal post in 20 seconds. What is its speed in kilometres per hour?
- 30
- 40
- 36 Correct answer.
- 45
Explanation
Passing a fixed post, the train covers its own length: 200 ÷ 20 = 10 metres per second. Multiplying by 3.6 converts to 36 km/h.
Question 50Numerical Reasoning and Quantitative Analysis
A sum becomes 1.21 times itself in 2 years under compound interest compounded annually. What is the annual rate?
- 12 percent
- 21 percent
- 10 percent Correct answer.
- 11 percent
Explanation
The growth factor over two years is 1.21, so the annual factor is the square root, 1.10. That corresponds to a rate of 10 percent per year.