Question
i.If you deposit Rs.15,000 in a bank account that pays 10% interest annually, how much will be in your account after 7 years? ii.What is
i.If you deposit Rs.15,000 in a bank account that pays 10% interest annually, how much will be in your account after 7 years?
ii.What is the present value of a security that will pay Rs.20,000 in 20 years if securities of equal risk pay 8% annually?
iii.What's the future value of a 9%, 4-year ordinary annuity that pays Rs.600 each year? If this was an annuity due, what would its future value be?
iv.An investment will pay Rs.100 at the end of each of the next 3 years, Rs.200 at the end of Year 4, Rs.300 at the end of Year 5, and Rs.500 at the end of Year 6. If other investments of equal risk earn 8% annually, what is its present value? its future value?
v.You give a house loan of Rs. 10,000 on 31st December. This is 10-year loan with a 10% interest rate to be paid semiannually from next June 30.
a. What is the periodic amount you will be receiving?
b. How much interest was included in the first payment? How much repayment of principal was included? How do these values change for the second payment? Prepare an amortization table.
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