1. Your employer offers all employees an optional two-month unpaid vacation after 7 years of service to the firm. You have just started working for the firm and you plan to take the option and have a vacation in Europe. You consulted a travel agency and was told that the estimated cost for the trip, after taking into account inflation, will be RM24,000 in total.
2. In order to finance the trip, you plan to make annual deposit of RM2,500 at the end of each year for the next seven years into a savings account paying 8% annual interest. Will you have sufficient funds in your bank account at the end of 7 years for the trip? Show your calculation.
3. After making further budgeting of your salary and hoping to have extra cash to spend on shopping during the vacation, you decided to put aside RM2,900 in your savings account that pays 8% annual interest. How much would you be able to spend on shopping after deducting the cost of the trip? Show your calculation.
4. b) You are hoping to get an annual stream of RM24,000 every year for the next 10 years. The current rate of return is 6% per annum. How much should you save today to enable you to withdraw RM24,000 at the end of each of the next 10 years?
5. c) Sani wants to know how much money he will have in his savings account at the end of six years if he keeps RM35,000 today in a bank that pays 12% interest compounded quarterly?