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a.
b.
c.
d.
Kathy’s rich uncle promises her an allowance of $10,000 per month for 6 months, with the first allowance to be made 1 month from today. If the interest rate is 0.5% per month, what is the present value of the promised allowance?
a.The present value of investment is $58,963.84.
b.The present value of investment is $4,785.69.
c.
d.The present value of investment is $60,000.
Phantom Limited borrows $150,000 at an interest rate of 12% per annum compounding quarterly, repayable by equal quarterly instalments over 30 years. Calculate the principal and interest components of the first repayment.
a.For the first repayment, the principal component is $133.49 and interest component is $4,500.
b.
c.
d.For the first repayment, the principal component is $133.49 and interest component is $4,200.
Starting with her next salary payment (next month), Kathy intends to save $200 each month. If the interest rate is 1% per month, how much will Kathy have saved after 12 months (12 deposits altogether over 12 months)?
Fill in the blank with the correct answer, rounded to 2 decimal places.
12 months later (in month 12), Kathy would have _________ in the bank account.
Using the following returns, calculate the average returns for Abundant and Slim.
Returns (%)
Year
Abundant
Slim
2006
8
15
2007
5
-4
2008
-6
-9
2009
7
11
2010
12
6
2011
9
10
a.The average return for Share Abundant is 5.83% and 4.83% for Share Slim.
b.
c.
d.
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