 |
FIM502S - FINANCIAL MATHEMATICS 1 - 1ST OPP - NOV 2022 |
|
|
1 Page 1 |
▲back to top |
nAmlBIA unlVERSITY
OF SCIEnCE Ano TECHnOLOGY
Faculty of Health and Applied Sciences
Department of Mathematics and Statistics
QUALIFICATION:Bachelor of Science; Applied Mathematics and Statistics
QUALIFICATIONCODE:07BSAM
LEVEL:5
COURSE:FINANCIALMATHEMATICS1
COURSECODE:FIM5025
DATE:November 2022
DURATION: 3 Hours
SESSION:Theory
MARKS: 100
'
EXAMINER(S}
FIRSTOPPORTUNITYEXAM QUESTIONPAPER
Dr Victor Katoma
MODERATOR:
Prof Samuel Eegunjobi
THIS QUESTIONPAPERCONSISTSOF 2 PAGES
(Excluding this front page)
INSTRUCTIONS
1. Answer ALL the questions.
2. Write clearly and neatly.
3. Number the answers clearly.
PERMISSIBLEMATERIALS
1. Non-programmable pocket calculator without the cover
|
|
2 Page 2 |
▲back to top |
QUESTION 1 (25 MARKS)
1.1 Explain/define the following:
1.1.1
Amortisation of a Loan repayment
(5)
1.1.2
Annuity
(2)
1.1.3
Deferred annuity
(2)
2.1 Rudy buys a piece of land for N$110,000. He makes 20% down payment and for the balance he
takes a loan for 25 years that charges an annual interest rate of 5% compounded monthly.
Find the
1.2.1 Monthly payments
(6)
1.2.2 Total amount of interest that will be paid
(5)
1.2.3 Amount of the loan that he would have paid after 10 years
(5)
QUESTION 2 (25 MARKS)
2.1
= 1-(v)n
Show that ClnJ -i-
(6)
2.2 Mr Kandji has purchased a farm worth N$50,000 through the bank. He has decided to pay
back the loan in yearly instalments in arrears over 5 years. If money is worth 8% p.a.,
schedule these payments on an amortization schedule.
{15)
2.3 Use an] to prove that after a third (3) payment the Loan balance is N$ 22,331.51
(4)
QUESTION 3 (25 MARKS)
3.1 What is time value of money?
(2)
3.2 Anna set up an annuity to save for her retirement. She arranged to have N$800 taken out of
each of her monthly wages and deposited into this account; it will earn annual interest of
4.5% compounded monthly. Shejust had her thirtieth birthday, and her ordinary annuity
comes to term when she is sixty-five. Find the following
3.2.1 The future value of the account
(7)
3.2.2 Anna's total contribution to the account
(3)
3.2.3 The total interest earned
(3)
2JPage
|
|
3 Page 3 |
▲back to top |
3.4 After making a down payment of N$4000 for an automobile, Murphy paid N$400 per
month for 36 months with interest charged at j = 12% on the unpaid balance
12
3.4.1 What was the original cost of the car?
(6)
3.4.2 What part of Murphy's total car payments went toward interest charges? (4)
QUESTION 4 (25 MARKS)
4.1 At what interest rate {compounded continuously) would an investment C0 centuple
{100 times) in 25 years?
(4)
4.2
= Prove that Sn]
(l+i)n-1
d
(5)
4.3 Define the following
4.2.1 Sinking fund
(3)
4.2.2 Perpetuity
{2)
4.2.3 Accumulation factor
(3)
4.2.4 Force of interest
(3)
4.4
Show that
..
an]=
1-(v)n
-d-
(5)
--END OF EXAMINATION-
(;')
KEEP
CALM
AND
GOOD
LUCK
3IPage