Question 1

a. Determine the present value of an annuity with semi-annual payments of R800 at 16% per year compounded half-yearly and with a term of ten years.

b. You purchase a small apartment for R180 000 with a down payment (often referred to as a deposit) of R45 000. You secure a mortgage bond with a bank for the balance at 18% per annum compounded monthly, with a term of 20 years. What are the monthly payments?