Mathematics > QUESTIONS & ANSWERS > Thompson Rivers UniversityMATH 1091MATH1091_Assignment4 (All)

Thompson Rivers UniversityMATH 1091MATH1091_Assignment4

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Assignment 4 Total marks: 100 1. If money is worth 13.5%, compounded semi-annually, what will have accumulated from end-of-monthly deposits of $1600 after 15 years? (6 marks) R= 1,600, n= 12×15= ... 180, i= 13%/2= 6.5%, c= 2/12= 1/6, f= (1+i)^c- 1= 0.0109 Sn= R[(1+f)^n-1]/f= 1,600[(1+ 0.0109)^180-1]/0.0109= 1,600×556.9473= $89,115.68 2. If you have been making loan payments of $500 at the beginning of every third month for 5 years, and if you are being charged 17%, compounded semi-annually, how much did you originally borrow? (6 marks) R= 500, n= 4×5= 20, i= 17%/2= 8.5%, c= 2/4= 1/2, f= (1+i)^c- 1= 0.0416 An(due)= R(1+f)[1-(1+f)^-n]/f= 500(1+ 0.0416)[1-(1+ 0.0416)^-20]/f= 500× 13.954=$6,976.79 3. If I want to save $50,000 for a house down payment in 8 years’ time, how much must I deposit at the end of every month if interest is paid quarterly at 13%? (6 marks) Sn= 50,000, n= 8×12= 96, i= 13%/4= 3.25%, c= 4/12= 1/3, f= (1+i)^c- 1= 0.0107 R= Sn/([(1+f)^n-1]/f)= 50,000/([(1+0.0107)^96-1]/0.0107)= 50,000/166.336= $300.60 4. A business valued at $1,500,000 is bought for $175,000 down with payments of $50,000 at the end of every 3 months. How long will payments have to be made if money is worth 13.5%, compounded monthly? (8 marks) [Show More]

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