Reference no: EM132964738

Questions -

Q1. Jack deposits his annual bonus into a savings account that pays 8% interest compounded annually. His bonus increases by P 1,500 each year, and the initial bonus amount is P 8,000. Determine how much money will be in Jack's account immediately after the 10th deposit.

Q2. If you desire to withdraw the amounts mentioned below over the next 5 years from a savings account that earns 9% interest compounded annually, how much do you need to deposit now?

Year Amount (P)

2 6000-

3 7000-

4 8000-

5 5000-

Q3. You are a 30-year-old serviceman and are planning to ensure an annual income of P 150,000 after your retirement at the age of 60, till you reach 80. You plan to make annual deposits into your account till you turn 60. If the interest rate is a constant 10% during the period, how much must you deposit annually into your account to generate the required income after retirement.

Q4. A merchant desires to obtain $6000- from his banker. (a) If the loan is to be for 90 days and if the banker charges 6% discount, for what sum will the merchant make out the note which he will give to the banker? (b) What simple interest rate is he paying?

Q5. A man wishes to donate immediate ly to a University sufficient money to provide for the erection and maintenance, for the next 50 years of a building which will cost $ 500,000 to erect and will require $ 1000 at the end of each month to maintain. How much should he donate if the University is able to invest its funds at 6% compounded semi-annually?

Q6. A man will receive his pension of P 5,000 at the end of each month for 10 years; first payment to occur 1 month after his 65th birthday. Assuming that he will live to receive all his payments, find the present value of his expectation if money is worth 8% compounded annually and his age now is 50 years old.

Q7. The cash value of a house is P 300,000. In buying it on the installment plan, a purchaser has agreed to pay P 8,000 at the end of each 6 months as long as necessary. For how long must he pay if money is worth 6%, compounded semiannually?

Q8. A man deposits P 100,000 with a trust company which credits 9% interest annually. The fund is to provide equal payments at the end of each year for 10 years, at the end of which time the fund is to be exhausted. Find the annual payment and construct an amortization table.