DSC1630 ASSIGNMENT 3 SEMESTER 1

DSC1630 ASSIGNMENT 3 SEMESTER 1.Question 1 Mabe borrowed an amount of money from his father. The loan will be paid back by means of payments of R25 000 each every second month for six years. An interest rate of 7,5% per year, compounded every two months, will be applicable. The amount of the loan is [1] R900 000,00. [2] R1 127 887,64. [3] R400 738,72. [4] R238 067,35. [5] R721 181,68. 3 Question 2 The opening balance of this fund is approximately [1] R474 536. [2] R157 895. [3] R1 105 351. [4] R631 579. [5] none of the above. 4 Question 3 James asks to reschedule the compensation in three payments, the first payment now, the second payment twice the size of the first payment four years from now, and the third payment three times the size of the first payment nine years from now. The Boxing Fund agrees on condition that the interest rate changes to 10,95% per year, compounded monthly. The amount to the nearest hundred rand that James can expect to receive four years from now is [1] R864 000. [2] R184 800. [3] R369 600. [4] R557 510. [5] none of the above. 5 6 7 Question 4 The present value of an annuity is R62 543,42. The time under consideration is 10 years and the applicable interest rate is 16% per year, compounded monthly. The future value of this annuity is [1] R625 434,20. [2] R581 913,00. [3] R306 521,61. [4] R1 333 517,61. [5] R162 612,89. 8 Question 5 On her 40th birthday Amy decides that she will go for a facelift when she turns 50. She estimates that it will cost her R48 000 when she turns 50. She starts saving immediately each month paying an amount into an account earning 8,58% interest per year, compounded monthly. The monthly payment is [1] R253,99. [2] R255,80. [3] R252,18. [4] R597,19. [5] R592,95. 9 Question 6 Thabo took out an endowment policy. The first annual payment was Rx, whereafter it increased yearly by R1 700. After 20 years the policy paid out R1 005 962. The applicable yearly interest rate is 10%. The value of x is approximately [1] R11 816. [2] R23 500. [3] R564. [4] R6 500. [5] R17 564. 10 11 Option 4 12 Question 8 The size of the loan (to the nearest rand) is [1] R1 680 000. [2] R1 333 820. [3] R4 453 642. [4] R2 167 317. [5] none of the above. 13 Question 9 The down payment is [1] R268 800. [2] R254 061. [3] R346 771. [4] R320 000. [5] R213 411. The down payment was R320 000. 14 Question 10 The applicable interest rate per year (compounded monthly) is [1] 5,2%. [2] 8,5%. [3] 12,70%. [4] 4,95%. [5] 10,2%. 15 Question 11 The value of B is [1] R41 163,61. [2] R42 652,45. [3] R40 810,13. [4] R40 540,45. [5] R41 586,01. The value of B which is the outstanding principal at the beginning of month 176 can be calculated as outstanding principal at the beginning of month 175 − principal repaid. B = 49 694,10 − 8 108,09 = 41 586,01. The value of B is R41 586,01.