Question No. 3: (10+5= 15marks)

1. Suppose you had the following propositions of returns from two companies W and Y:

(10Marks)

Company	Returns (OMR)	Comments
W	475	Company W proposes to give OMR 475 today
Y	550	Company Y proposes to give you OMR 550 but after 2 years

You also know that the Interest Rate is by 10%.

Question: In which company do you choose to invest your money and why? (Use two formulas (ways) and also use Tables to make sure your answers are correct).

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2. You would like to purchase a Car that costs OMR 50000. You planned with your banker to collect the amount for this project. (5Marks)

You decided to deposit OMR 9450 each year and during 5 years.

Suppose also that the bank gives an annual Interest Rate of 6%.

Questions:

1. Trace the Time Line illustrating the story
2. What would be the amount collected at the end of the seventh year?
3. Will you have enough money to buy the motorcycle? How much is the difference between the amount saved and the motorcycle price? Can you buy it?

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