Financial Maths

What is the trade in value of Lesedi's car in 5 years time ?

• R99741,33

• R67959,45

• R74406,45

• R103412,61

Answer explanation

The trade in value of the car in 5 years time will be the value that the car depreciated at in 5 years time, thus use the compound decay formula .

The cost of the new car in 5 years time ?

• R333082.58

• R441624.90

Answer explanation

The value of the sinking fund in 5 years time if Lesedi trades in the car ?

• R67959,45

• R333082,58

• R265123,13

Answer explanation

The quarterly payments into the sinking fund ,if it earns an interest rate 6,5% p.a compounded quarterly and payments start 3 months after the car is initially purchased ?

• R 12 798,31

• R11 324,99

Answer explanation

Payments began 3 months later after the car was purchased means that the payments started at the end of the quarter , 3 months is equal to 1 Quarter .

Note : there were no missed payments

How much will Bridgette have saved for her car if she earns 4,3% interest p.a. compounded quarterly ?

• R26035,55

• R33270,71

• R6097,45

Answer explanation

From the beginning of grade 8 to the end of grade 12 there is 5 years ,in each year there is 4 terms , so 5 * 4 = 20 , 20 payments all together.

Bridgette's parents would like her to have R95000 to spend on a car at the end of matric, they make equal installments starting from when Bridgette is in Grade 8 ,into the account that earns a 3,8% interest p.a. compounded monthly. How much do Bridgette parents need to deposit each month ?

• R935,81

• R12268,02

• R5055,17

• R61729,83

Answer explanation

• R475215,87

• R424274,04

Answer explanation

Payments begin on her 15th birthday so payments begin at the beginning of the quarter, thus payment's will end 1 quarter before she turns 24 years, there will therefore be interest incurred for 1 quarter on the future value of the investment on the last payment.

• R387353,19

• R389289,96

• R389290

Answer explanation

18 * 12 = 216 There were 216 payments made

payments were made the day the child was born thus the payment's were made at the beginning of the period.

payments will therefore incur 1 month interest.

Round off to the nearest rand not to 2 decimal places.

Mathematical Equivalence

OFF

Answer explanation

Mathematical Equivalence

ON

Answer explanation

First find out the interest that will be accumulated on the single deposit of R1000 On the 1st April 2022 using the compound growth formula.

Then find out the future value of the regular monthly deposits , using the future value formula.

Add up the 2 answers.