A 90-day government bill was bought by an investor for a price of K95 per K100 nominal. After 30 days the investor sold the bill to a second investor for K97.50 per K100 nominal. The second investor held the bill to maturity when it was redeemed at par. Determine which investor obtained the higher annual effective rate of return.

Mr Banda is struggling to repay his loan of K400,000 with payments of K7,200 made monthly in arrears for 6 years.

(a) Calculate the flat rate of interest per annum.

(b) Hence, or otherwise, calculate the APR of Mr Banda's loan.

After exactly one year, a loan company offers to "help" Mr Banda by restructuring his loan with new monthly payments of K4,000 made in arrears. (c) Assuming the company charges the same APR as Mr Banda's original loan, calculate the term of the new loan.

(d) Calculate how much more interest in total Mr Banda will pay on his restructured loan than on his original loan.