a)bank pay interest 13%

b) NBP 9.81% UBL 9.40% HBL. 9.63% ABL 10.10%

Q. 3: (a). On your birth, your father decided to open an account in your name and deposit a fixed amount of Rs. 20,000 in it each year (the first payment is made on your first birthday). The bank pays an interest of 1_%, (put the 3rd digit of your roll number), compounding annually, on the deposits. You just turned 21 years old and can withdraw your money from the bank. What amount of cheque will you write to withdraw all of your money from the bank? 2. (b). Assume that the following interest rates and compounding periods are offered by Pakistani banks (For simplicity assume both lending and borrowing rates are the same). S. No Bank Name Nominal Interest Rate Compounding 1. NBP 9.8_% (Put 1 Digit) Quarterly UBL 9.4_% (Put 200 Digit) Weekly (Assume 50 weeks in a year) 3. HBL 9.6_% (Put 3rd Digit) Monthly 4. ABL 10.10% Annually (i). If you have savings and want to deposit with one of the banks then which of the banks will you choose? Justify your answer. (ii). If you are in need of money and want to borrow from one of the banks then which of the banks will you choose? Justify your answer. (2+4= 6 Marks)