QUESTION 1
A loan will be paid back by means of payments of R250 each, every six month for ten years. An interest
rate of 5% per year, compounded every six months, will be
applicable. The present value of the loan is
a. R1 930,43.
b. R6 386,16.
c. R3 144,47.
d. R3 897,29. Correct answer
QUESTION 2
A nominal interest rate of 19,40% per year, compounded monthly, is equivalent to a continuous
compounding rate of
a. 21,22%.
b. 21,41%.
c. 19,56%.
d. 19,24%.
QUESTION 3
An amount of money accumulates to R45 946 at a continuous compounding rate of 8% per year, after 57
months. The original amount is
a. R31 460,34.
b. R33 294,20.
c. R36 756,80.
d. R31 420,70.
e. R28 486,52.
QUESTION 4
An interest rate of 14,90% per year, compounded every 3 months, is equivalent to a weekly compounded
interest rate of
a. 15,16%.
b. 14,65%.
c. 19,02%.
d. 14,88%.
, QUESTION 5
Daniel deposits R1 500 at the end of every month into an account that earns 12,5% interest per year,
compounded monthly. After two years, he stops making these monthly contributions because the
interest rate changes to 15% per year, compounded every two months. If no withdrawals or deposits are
made for four years the balance in the account will be
a. R72 517,49.
b. R40 660,72.
c. R65 114,13
d. R62 224,96.
e. R73 544,10.
QUESTION 6
Henry decides that he would like to buy his lovely wife, Connie, a new car when she turns 30 in six years’
time. He deposits R6 000 each month into an account earning 8,94% interest per year, compounded
monthly. The amount that Shona (rounded to the nearest rand) will have available six years from now is
a. R568 948.
b. R573 187.
c. R333 412.
d. R335 896.
Question 7
Gladys want to buy a new gaming computer for R40 000. She decides to save by depositing an amount of
R400 quarterly into an account earning 16% interest per year, compounded quarterly. The approximate
number of quarters it will take Gladys to have R40 000 available is
A. 2 quarters.
B. 12 quarters.
C. 40 quarters.
D. 41 quarters.
QUESTION 8
If Is simplified, then the equation becomes
A loan will be paid back by means of payments of R250 each, every six month for ten years. An interest
rate of 5% per year, compounded every six months, will be
applicable. The present value of the loan is
a. R1 930,43.
b. R6 386,16.
c. R3 144,47.
d. R3 897,29. Correct answer
QUESTION 2
A nominal interest rate of 19,40% per year, compounded monthly, is equivalent to a continuous
compounding rate of
a. 21,22%.
b. 21,41%.
c. 19,56%.
d. 19,24%.
QUESTION 3
An amount of money accumulates to R45 946 at a continuous compounding rate of 8% per year, after 57
months. The original amount is
a. R31 460,34.
b. R33 294,20.
c. R36 756,80.
d. R31 420,70.
e. R28 486,52.
QUESTION 4
An interest rate of 14,90% per year, compounded every 3 months, is equivalent to a weekly compounded
interest rate of
a. 15,16%.
b. 14,65%.
c. 19,02%.
d. 14,88%.
, QUESTION 5
Daniel deposits R1 500 at the end of every month into an account that earns 12,5% interest per year,
compounded monthly. After two years, he stops making these monthly contributions because the
interest rate changes to 15% per year, compounded every two months. If no withdrawals or deposits are
made for four years the balance in the account will be
a. R72 517,49.
b. R40 660,72.
c. R65 114,13
d. R62 224,96.
e. R73 544,10.
QUESTION 6
Henry decides that he would like to buy his lovely wife, Connie, a new car when she turns 30 in six years’
time. He deposits R6 000 each month into an account earning 8,94% interest per year, compounded
monthly. The amount that Shona (rounded to the nearest rand) will have available six years from now is
a. R568 948.
b. R573 187.
c. R333 412.
d. R335 896.
Question 7
Gladys want to buy a new gaming computer for R40 000. She decides to save by depositing an amount of
R400 quarterly into an account earning 16% interest per year, compounded quarterly. The approximate
number of quarters it will take Gladys to have R40 000 available is
A. 2 quarters.
B. 12 quarters.
C. 40 quarters.
D. 41 quarters.
QUESTION 8
If Is simplified, then the equation becomes
