Calculating the amount of the quarterly repayment


Answer the following questions

Question1) Mr A. Pilot deposits $130 at the end of each quarter for 4 years and then $80 at the end of each quarter for another 6 years, into a savings account earning 9% pa convertible quarterly. Calculate the amount of money that will be in the account just after Mr A. Pilot makes the final deposit of $80. Give your answer in dollars and cents to the nearest cent.

Question2) Alicia's parents wish to purchase a home costing $400,000. They have a $160,000 deposit and intend to borrow the balance from Rarepoor Bank at an interest rate of j4 = 13.6% pa compounded quarterly repayable over 15 years. Calculate the amount of the quarterly repayment. Give your answer in dollars and cents to the nearest cent.

Question3) Wai Man saves $3,000 at the end of each year and invests it at 10% pa effective. Calculate the accumulated value (S) after 14 years. Give your answer in dollars and cents to the nearest cent.

Question4) A particular rental agreement requires quarterly payments of $350 for 17 years paid in arrears. Calculate the present value (P) of this agreement if money is worth 14% pa convertible quarterly. Give your answer in dollars and cents to the nearest cent.

Question5) If a perpetuity paying $171.60 at the end of each year has a present value of $3,000, find the rate of interest per annum. Give your answer as a percentage per annum to 2 decimal places.

Question6) The cash price of a used car is $19,500. Dulani wishes to pay for it in 25 quarterly instalments. If an interest rate of 3% pa compounded quarterly is charged, find the size of the quarterly payment (R) payable at the end of each quarter. Give your answer in dollars and cents to the nearest cent.

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Finance Basics: Calculating the amount of the quarterly repayment
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