(TIME VALUE OF MONEY)

QUESTION 2

a) Syirah must have RM30,000 in order to buy a piece of vacant land. She plans to save RM1,500 per year in her savings account with Amanah Bank that pays 12% interest rate compounded annually. How many years will it takes if the first saving being made a year from today? Do interpolation. (6 marks)

b) Hazman borrows RM24,000 in the form of education loan from Bijak Bank. The payments are to be made in installment basis at the end of year. The tenure of loan is for 5 years at an interest rate of 10% per annum. Determine the amount that Hazman will have to pay each year for 5 years? (4 marks)