PART A (Total 15 marks) 1. Dolly is planning to move to the Sunshine Coast and has just purchased a new beach front property in Noosa for $3,000,000. ANZ Bank has offered Dolly a 25 years term loan with monthly repayments at a nominal rate of 4% per annum. Dolly must deposit 20% of property value to access this loan. If Dolly puts up 20\% deposit and borrows the rest from ANZ Bank, what will be her monthly repayment amount? (Show answer correct to the nearer cent.) (3 marks) 2. Paul has been offered a contract through which he expects to generate the following stream of cash flows. Cash flows will occur at the end of the nominated years. FINZOO FINANCIAL MANAGEMENT T322 V2.0 "AUSTRALAN INSTITUTE OF BUSINESS AND MANAGEMENT PTY LTD O ABN: 72132629979 PAGE 9 of 16 Cricos 03171A FIN700 Paul expects the market interest rates will be 2.5% per annum for the next 5 years, then it will increase to 5% per annum for the following three years (years 68 ) and will increase again in years 910 to 6% per annum. Assuming Paul's expectations regarding cash flows and interest rates are correct calculate the accumulated value of all these cash flows at each of the following times. (Show answers correct to the nearer cent.) (12 marks) a. Today (Timeo) b. 6 years time (Times) c. 10 years time (Time 10)