QUESTION 5 (25 MARKS (a) Explain the relationship between earning power and purchasing power with respect to increase in time. Graphically illustrate your answer. [4 marks] A prominent credit card company based in the Klang Valley offered you a card that charges monthly interest at 1.65%, compounded monthly. (b) (0) Calculate the annual percentage rate (APR) and the annual percentage yield (APY) that the company charges on its credit card. [4 marks] Explain the reason why there is a difference in the value of APR and APY. [2 marks] Suppose that your current outstanding credit card balance is RM2,000 and you skip payments for the next four months. What will be the total outstanding balance four months from now? [2 marks] Puan Aishah plan to send her new born daughter to a university for her higher education in the future. She started now to deposit RM1200 every quarter in a AMANAH WAWASAN unit trust account with annual interest rate of 8% for 10 years. What will be the total amount of cash that she can withdraw from the savings account when her daughter reaches the university enrolment age of 18 years old? (5 marks] Mr Munawir has a RM550 monthly car payment, which is based on 6% annual interest, compounded monthly (c) (d) (0) Determine the price of the car if it was financed for 7 years and a down payment of RM4,000 was paid. [4 marks] QUESTION 5 (25 MARKS (a) Explain the relationship between earning power and purchasing power with respect to increase in time. Graphically illustrate your answer. [4 marks] A prominent credit card company based in the Klang Valley offered you a card that charges monthly interest at 1.65%, compounded monthly. (b) (0) Calculate the annual percentage rate (APR) and the annual percentage yield (APY) that the company charges on its credit card. [4 marks] Explain the reason why there is a difference in the value of APR and APY. [2 marks] Suppose that your current outstanding credit card balance is RM2,000 and you skip payments for the next four months. What will be the total outstanding balance four months from now? [2 marks] Puan Aishah plan to send her new born daughter to a university for her higher education in the future. She started now to deposit RM1200 every quarter in a AMANAH WAWASAN unit trust account with annual interest rate of 8% for 10 years. What will be the total amount of cash that she can withdraw from the savings account when her daughter reaches the university enrolment age of 18 years old? (5 marks] Mr Munawir has a RM550 monthly car payment, which is based on 6% annual interest, compounded monthly (c) (d) (0) Determine the price of the car if it was financed for 7 years and a down payment of RM4,000 was paid. [4 marks]
