Financial Mathematics Quiz Worksheet - Math Studies 12 Year 2 Page 3
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15 Write your FULL name: ________________________________________
Working:
Answers:
(a) …………………………………………..
(b) …………………………………………..
(Total 4 marks)
5.
Miranti deposits $1000 into an investment account that pays 5% interest per annum.
(a)
What will be the value of the investment after 5 years if the interest is reinvested?
(2)
(b)
How many years would it take Miranti’s investment of $1000 to double in value?
(4)
At the beginning of each year Brenda deposits $1000 into an investment account that pays 5%
interest per annum. Interest is calculated annually and reinvested.
(c)
How much would be in Brenda’s account after 5 years?
(4)
(Total 10 marks)
6.
John invests X USD in a bank. The bank’s stated rate of interest is 6% per annum, compounded
monthly.
(a)
Write down, in terms of X, an expression for the value of John’s investment after one year.
(b)
What rate of interest, when compounded annually (instead of monthly) will give the same
value of John’s investment as in part (a)? Give your answer correct to three significant
figures.
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