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Answer the following problems

problem1) Mr A. Pilot deposits $130 at the end of each quarter for 4 years and then $80 at the end of each quarter for another 6 years, into a savings account earning 9% pa convertible quarterly. find out the amount of money that will be in the account just after Mr A. Pilot makes the final deposit of $80. Give your answer in dollars and cents to the nearest cent.

problem2) Alicia's parents wish to purchase a home costing $400,000. They have a $160,000 deposit and intend to borrow the balance from Rarepoor Bank at an interest rate of j4 = 13.6% pa compounded quarterly repayable over 15 years. find out the amount of the quarterly repayment. Give your answer in dollars and cents to the nearest cent.

problem3) Wai Man saves $3,000 at the end of each year and invests it at 10% pa effective. find out the accumulated value (S) after 14 years. Give your answer in dollars and cents to the nearest cent.

problem4) A particular rental agreement requires quarterly payments of $350 for 17 years paid in arrears. find out the present value (P) of this agreement if money is worth 14% pa convertible quarterly. Give your answer in dollars and cents to the nearest cent.

problem5) If a perpetuity paying $171.60 at the end of each year has a present value of $3,000, find the rate of interest per annum. Give your answer as a percentage per annum to 2 decimal places.

problem6) The cash price of a used car is $19,500. Dulani wishes to pay for it in 25 quarterly instalments. If an interest rate of 3% pa compounded quarterly is charged, find the size of the quarterly payment (R) payable at the end of each quarter. Give your answer in dollars and cents to the nearest cent.

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M94196

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