Question

Given below is a foreign language phrase that is commonly used. Choose the correct meaning of the phrase
Pro rata
A. at the rate of
B. at quoted rate
C. in proportion
D. beyond all proportion

Answer 1

Hint: This is a Latin expression used as an adverb or adjective for proportionate distribution of amount, share etc. mainly in legal, financial etc. setups.
Example: The shares of our company will be distributed among the shareholders on a pro rata basis.

Complete step by step answer:
Option A – at the rate of:
In the accounting field ‘at the rate of’ is abbreviated or indicated by the ‘@’ sign. This is used to depict numbers, especially in financial data representation.
Example: 10 copies @ Rs. 2 per copy = Rs. 20
But at the rate of doesn’t have its roots in Latin. Hence the option is inappropriate.
Option B – at quoted rate:
As already discussed, rate doesn’t come from Latin. Hence this option isn’t appropriate.
Option C – in proportion:
The Latin term ‘pro rata’ is an adjective or adverb used as it is in English from Latin. It means proportional or in proportion (with). This implies that the distribution of anything in discussion will be equal and everyone will get a justifiable share.
Example: There will be a pro rata increase in salaries this year. – This implies that the salary increment will happen in proportion to a given amount (like profit, share, revenue etc.) and everyone should expect a similar % rise in their salaries.
Option d – beyond all proportion:
As explained in the option ‘C’, pro rata directly translates to ‘in proportion’. Hence ‘beyond all proportion’ can’t be correct.

Thus, the correct answer is option ‘C’ – ‘in proportion’..

Note:
Latin phrases, terms or expressions are widely used in Financial and Legal fields and some of them are a part of day-to-day usage. Like- pro rata – in proportion, ab initio – from the beginning, ad hoc – when necessary, de facto – in fact etc.