Annuities & Loan Repayments (Grade 12) — Worksheet & Memo

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Grade 12 · Finance, Growth and Decay

Annuities & Loan Repayments (Grade 12)

WORKSHEET

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Mark

/ 34

Answer all questions. Show all your working — marks are awarded for method as well as the final answer.

1
R1 500 is deposited monthly for 20 years at 9% p.a. compounded monthly. Determine the future value.
(3)
2
How much was actually deposited in total in that annuity?
(2)
3
A bond of R800 000 is repaid monthly over 20 years at 9% p.a. compounded monthly. Determine the monthly instalment.
(4)
4
Determine the outstanding balance on that bond after 5 years.
(4)
5
Write down the value of i for 9% p.a. compounded monthly.
(1)
6
Which formula do you use when saving towards a future amount?
(1)
7
Which formula do you use for a loan taken out today?
(1)
8
How is the outstanding balance on a loan calculated?
(2)
9
How long will it take R20 000 to double at 8% p.a. compounded annually? Give your answer in whole years.
(4)
10
A vehicle costing R450 000 depreciates at 15% p.a. on a reducing balance. Calculate its scrap value after 4 years.
(3)
11
In a sinking-fund question, state the THREE amounts you must calculate before working out the monthly payment.
(3)
12
Option A pays 9,6% p.a. compounded monthly; Option B pays 9,9% p.a. compounded annually. Which is better? Show your reasoning.
(4)
13
Why can a loan with a lower monthly instalment cost you more overall?
(2)

TOTAL: 34 marks