DSC1630 EXAM PACK 2022

DSC1630 EXAM PACK 2022. DSC1630 - Introductory Financial Mathematics A bank’s simple discount rate is 12% per annum. You need to pay the bank R5 000 in six months’ time. The amount of money that you will receive from the bank now is [1] R4 700,00. [2] R4 716,98. [3] R4 724,56. [4] R5 300,00. [5] R5 319,15. Question 3 Jacob invests R8 350 in an account that pays simple interest. After six years,the amount that he receives (accumulated sum) is R12 859. The simple interest rate on the investment, rounded to two decimal places, is [1] 0,75% per year. [2] 45,09% per year. [3] 1,08% per year. [4] 9,00% per year. [5] none of the above. Question 4 The accumulated amount that Mabe will receive after 38 months if she deposits R13 300 into an accwhere money is worth 11,35% per year compounded every two months is [1] R14 117,08. [2] R15 690,19. [3] R18 080,24. [4] R18 865,83. [5] R18 988,31. Page 2 of 13 S - The study-notes marketplace Downloaded by: tebzamabalane | Distribution of this document is illegal S - The study-notes marketplace CONFIDENTIAL Page 3 of 13 DSC1630 May/June 2020 Question 5 Sakkie borrowed an amount of money from Lulu. The loan willbe paid back by means of payments of R25 000 every second month for six years. An interest rate of 7,75% per year compounded every second month will be applicable. The present value of the loan is [1] R238 067,35. [2] R400 738,72. [3] R716 113,21. [4] R900 000,00. [5] R1 136 672,90. Question 6 On 16 April,Nkosideposited an amount of money in a savings account that earns 8,5% per annum, simple interest. He intends to withdraw the balance of R2 599 on 8 December of the same year (not leyear) to buy himself a new bicycle. The amount of money that Nkosi deposited is [1] R2 460,03. [2] R2 461,82. [3] R2 463,60. [4] R2 465,46. [5] R2 458,18. Question 7 Bi Cycle agreed to establish the Spike Fund from which they will pay Handle R2 500 per month indefinitely as compensation for injuries he sustained while working on the Riley project. Money is worth 12,5% per year, compounded monthly. The opening balance of this fund is [1] R170 792,83. [2] R200 000,00. [3] R240 000,00. [4] R281 869,63. [5] R492 680,86. Question 8 A furniture company charges a finance fee of 0,13% per week on outstanding balances. The effective rate per annum is [1] 6,76%. [2] 6,99%. [3] 13,01%. [4] 13,86%. [5] 25%. Page 3 of 13 S - The study-notes marketplace Downloaded by: tebzamabalane | Distribution of this document is illegal S - The study-notes marketplace CONFIDENTIAL Page 4 of 13 DSC1630 May/June 2020 Question 9 An amount borrowed at 29% interest per year, compounded continuously, has accumulated to R38 2after four years.The initial amount borrowed was [1] R7 160,73. [2] R12 000,00. [3] R12 005,53. [4] R13 823,05. [5] R17 721,85. Question 10 Jack will need R20 000 to buy his brother’s old car in two years’ time. He wants to start saving part of his weekly salary in an account that returns 9,3% interest per year, compounded weekly. The minimum weekly payment that he needs to make into this investment account to have enough in two years’ tiis [1] R175,15. [2] R767,45. [3] R210,92. [4] R909,11. [5] none of the above. Question 11 Poppy dreams of becoming a chef. She has a fund of R40 000 available to cover her expenses at a chef schoolover the next four years. She withdraws the same amount from the fund at the beginning of each month to pay for the chef course. If the interest rate is 7,4% per year, compounded monthly, then the value of each monthly withdrawal is [1] R718,62. [2] R714,22. [3] R959,37. [4] R965,29. [5] none of the above. Page 4 of 13 S - The study-notes marketplace Downloaded by: tebzamabalane | Distribution of this document is illegal S - The study-notes marketplace CONFIDENTIAL Page 5 of 13 DSC1630 May/June 2020 Question 12 Peter borrows R500 000 from a bank and he will repay the loan by means of monthly payments of Rstarting at the end of the first month. Interest is fixed at 18% per annum, compounded monthly. The number of full payments of R8 000 that he would have made by the time the loan is paid off is [1] 186. [2] 16. [3] 104. [4] 62. [5] none of the above. Question 13 You have started saving to replace your car when you retire in 20 years’ time.Your first payment was R3 600 at the end of the first year, after which your yearly payments increased by R360 each year. If the expected interest rate per year is 10% compounded annually, the amount, to the nearest rand, tyou will be able to pay towards your new car in 20 years’ time will be [1] R206 190. [2] R340 380. [3] R134 190. [4] R412 380. [5] none of the above. Question 14 Margaret, owner of the Beautiful Me Spa, will discharge a debt that will be worth R870 000 eight yeafrom now using the sinking fund method. The debt’s interest rate is 13,4% per year, compounded quarterly.The sinking fund willearn interest at a rate of 9,2% per year,compounded monthly. Her monthly deposit in the sinking fund is [1] R5 102,65. [2] R6 166,12. [3] R9 062,50. [4] R15 582,62. [5] R18 538,10. Page 5 of 13 S - The study-notes marketplace Downloaded by: tebzamabalane | Distribution of this document is illegal S - The study-notes marketplace CONFIDENTIAL Page 6 of 13 DSC1630 May/June 2020 Question 15 The following table represents the cash inflows for the Tunkle Toes Boutique for nine years: Year Cash inflow (R) 3 45 000 6 90 000 9 115 000 The applicable interest rate, at which money can be invested is 11,59% per year. Th present value of the cash outflows is R95 000. The MIRR (modified internal rate of return) is [1] 14,72%. [2] 21,25%. [3] 31,90%. [4] 38,06%. [5] 41,91%. Question 16 Two months ago,Michaeldeposited R9 000 into a savings account at a simple interest rate of 11,5% per year.He also deposited R5 000 six months ago into another savings account earning 8% per yeacompounded half-yearly. The total amount of Michael’s savings in three years’ time from now is [1] R17 729,32. [2] R18 857,16. [3] R18 891,66. [4] R19 330,00. [5] none of the above. Question 17 Sharon opened an investment account in which she deposited R9 000,00. After three months her car broke down and she had to withdraw R2 320 from the investment account for repairs. The account pays 10% interest per annum, compounded quarterly. The amount of money she will have left in the account after three months (one quarter), is [1] R6 905,00. [2] R9 225,00. [3] R6 509,00. [4] R7 259,50. [5] none of the above. Page 6 of 13 S - The study-notes marketplace Downloaded by: tebzamabalane | Distribution of this document is illegal S - The study-notes marketplace CONFIDENTIAL Page 7 of 13 DSC1630 May/June 2020 Questions 18, 19 and 20 relate to the following situation: A dentistneeds R400 000 to buy a new surgical chair for his practice.He will pay a R50 000 deposit and secure a loan for the outstanding amount. The loan has to be paid off in five years’ time in monthly payments, at a fixed interest rate of 18% per year, compounded monthly. Question 18 The size of the dentist’s monthly payment is [1] R3 637,70. [2] R8 887,70. [3] R73 181,26. [4] R108 399,27. [5] none of the above. Question 19 The interest paid in the second month is [1] R5 195,43. [2] R10 445,43. [3] R63 000,00. [4] R60 000,00. [5] none of the above. Question 20 The outstanding amount on the loan at the end of the third month, to the nearest rand, is [1] R178 024. [2] R171 976. [3] R203 456. [4] R338 922. [5] none of the above. Page 7 of 13 S - The study-notes marketplace Downloaded by: tebzamabalane | Distribution of this document is illegal S - The study-notes marketplace CONFIDENTIAL Page 8 of 13 DSC1630 May/June 2020 Questions 21, 22 and 23 are based on the following situation: Gogo Maria produces small tubs of atchar, which she sells at a street corner near her home. Her grandson thinks she is asking too little for her produce and is interested in estimating how her sales are influenby the price of her product. They randomly choose six street corners with similar characteristics in the township and offer the tubs at different prices on each corner. The following data were collected: Street corner Price (x) Number Sold/Sales (y) Mahube R13 100 First R16 90 Ikageng R18 90 Vilakazi R20 40 Freedom R24 38 Mlangeni R29 32 Question 21 If atchar tub sales are the dependent variable (y) and the company conducts a simple linear regressthe estimated slope parameter for the atchar tub price and sales data is [1] 161,386. [2] 0,784. [3] −0,3810. [4] −4,8193. [5] none of the above. Question 22 The percentage of the total variation in atchar tub sales explained by the regression model is [1] 100%. [2] 88,54%. [3] 78,39%. [4] 48,19%. [5] none of the above. Question 23 If the price of the atchar is set at R30, the value for the predicted approximated number of tubs sold[1] 30. [2] 17. [3] 32. [4] 100. [5] 64.