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You are currently making R20 000 after tax. You realised of the R20 000 you only have R300 at the end of the month to
You are currently making R20 000 after tax. You realised of the R20 000 you only have R300 at the end of the month to save after all your other financial obligations. You are considering two different options. Option A: You can invest in the stock market where the value per share grows by an effective yearly rate of 10%. Option B: you can put your money into the bank at a nominal yearly rate of 8%. i) 11] How much money would you have with Option A after 5 years if you only invest the money annually at the end of each year? ii) [7] Which is the better investment after 5 years if you invest the money at the end of each month, and compounding at the bank happens daily? Calculate the two amounts, and motivate why your chosen option is better
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