A. Calculate the initial monthly payment for a loan of R40000 payable over 4 years at an interest of 15% if payments between month 12 and 36 are suspended Answers must be rounded to 2 decimal places and use "." not "." no "R" signs and no spaces between numbers. Initial monthly payment is R The interest paid for this loan between month 1 and 48 is R The principal paid for this loan between month 1 and 36 is R

B. Vechile price is R180 000. The term of the loan is 60 months. Initial interest rate is 11%. The bank requires a 10% deposit and the client has opted for a 30% residual. The client has indicated that there might be unable to make payments in year 2 of the loan but would like you to structure a uniform payment for the months that they will be able to make payments. Based on an ongoing trend, you expect interest rates to decline by 25 basis points every year for the duration of the loan. Answer the questions below:

1. What will be the uniform payment for this loan without factoring the skipped months but catering for the interest rate changes? R

2. What will be the uniform payment if the skipped months are taken into account but loan is still paid off in 60 months? R

3. How much more in total interest paid will the client pay if they choose to suspend/skip those payments?

C. You have been tasked with incorporating interest rates that are linked to the SARB rates. This means that any changes to the repo rate will affect the interest rate used for a loan. Your client would like to have a uniform payment for the duration of the loan despite the anticipated changes in interest rates. Answer the following questions for a R150 000 5 year loan with an initial interest of 16% per annum:

1. What is the initial monthly payment, without factoring in future changes in interest, that would pay off the loan in the 5 years? R

2. What would be the uniform monthly payment that takes into account a 25 basis point decrease every year? R

3. What is the total interest paid for this loan using the uniform payment? R Your client would like to know how a flexible payment that entails a revision to the monthly payment with every interest rate change would look like.

4. What will be the monthly payment in the following years: Year 2 : R Year 3: R Year 4 : R Year 5 : R ls

5. What is the total interest paid using this changing payment method? R

D. You have been approached to structure a payment plan for a bank client who has been granted a loan of R120 000 at 9% per annum for 60 months. The client is faced with some difficulties so cannot afford the loan payment initially for the first 2 years. However, from the beginning of year 3 the client would be able to contribute an extra amount every year for the rest of the term to ensure that they payoff the loan in the stipulated term. Draw up an amortization table and answer the questions below. All answers to the nearest cents.

B: Extra payment not Growth.

1. What would have been the normal monthly payment for a loan like this? R

2. If the client can only afford R1500 for the first 2 years, what should be the extra payment each month when the client starts making the normal payments for the loan from the beginning of year 3? R 3. How much total interest would be paid over the entire period? R