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SECTION B (14 marks) Answer all questions. 1. A debt of RM 10,600 is bearing interest at 6.5% compounded quarterly is to be discharged by

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SECTION B (14 marks) Answer all questions. 1. A debt of RM 10,600 is bearing interest at 6.5% compounded quarterly is to be discharged by the sinking fund method. If nine equal quarterly deposits, the first due in three months, are made into a fund that pays 4.5% compounded quarterly, (a) Find the size of each quarterly deposit. (b) Find the quarterly cost of the debt. (7 marks)

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