\fBBFztt INTRODUCTION TO FINANCIAL MANAGEMENT Assignment 2 RM24l1J10 in three years' time and she will need 10% of the selling price as a deposit to book the condo. If she puts RMEJJDD now in an acoount that yields 15% interest oompounded semi annually, calculate how much more would she need to deposit soon after she has graduates. (5 marks] QUESTION 2 (25 MARKS] a]: bl Mei Lin is putting money aside to purchase a new automobile in four years. She plans to save RMdED at the end of each month for the next four years. She plans to put the money into a savings acoount with a monthly interest oompounding rate of 2.0 percent. Determine how much money she will have in four years. (5 marks} In ten years, John Hsu hopes to establish a business. He aims to acquire RM2IJD,DIJD to invest in the rm by that time. To achieve his aimr he wants to put a particular sum today in an investment fund that will pay him 3.0 percent per annumr compounded semi-annually. Calculate how much John will have to invest today to reach his goal. (5 marks} Mulhu had just acquired a car loan from a bank. The bank had agreed to lend him RM12D,DI]D in exchange for a 5% down payment on the automobile. Muthu would have to pay monthly instalments to repay the debt at a rate offitl peroent per annum compounded monthly for 9 years. i} Compute the amount ofhis monthly payment. (5 marks] BBFZ'II INTRODUCTION TO FINANCIAL MANAGEMENT Assignment 2 Additional information Ignore tax effects. Cost of capital is at 10% per annum. a} Using only Net Present Value as your basis of decision, recommend to the production manager to retain the current machinery, or to replace it. {1ir marks} b} Give TWO criticisms each for the Accounting Rate DI Return and Payback Period capital budgeting techniques. [3 marks] END OF ASSIGNMENT 2