Jo has secured a high paying job on a three year contract in Saudi Arabia. During that time they want to save enough money have a deposit for a house by the time they return home. Their target is $100,000. They find a savings account at the Royal bank that pays interest j₄ = 6.04% p.a. Jo hopes to achieve his savings target by depositing the same amount each three months for three years, starting in three month's time.

[2 marks] Illustrate the cashflows associated with this scenario as a fully labelled timeline diagram.

[3 marks] Determine the required size of his quarterly deposit.

[1 mark] Describe and perform a sanity check for your answer to (b)

[5 marks] Construct a sinking fund schedule showing the last two deposits. Ensure that you show how you got your starting value, and also that you provide example calculations for one line from the table.

[1 mark] Describe and perform a sanity check for your answer to (d)