Question 3 [10]

Mrs. Vilakazi is a farmer in Limpopo and a great businesswoman who is paying R1,000.00 per month on her savings annuity for and a 1/2 years(3.5) at an interest rate of 6% compounded semi-annually.

Before the COVID-19 lock down, she amortized a loan for a new business premises, by obtaining a 15-year mortgage at a rate of 7.5% compounded monthly.

The value of the premises is R840,000.00. She decided to use her savings as a deposit to purchase the premises. You may assume that the savings annuity had reached maturity when the deposit was paid.

3.1 Determine Mrs. Vilakazi's total savings. [3]

3.2 Determine the monthly repayment on the loan. [3]

3.3 Draw up an amortization schedule for the given intervals using the given headings. [4]