UNIVESITY OF KWAZULU-NATALDIVISION OF ECONOMICSECONOMICS 202CLASS RECORD TEST 3: 22ndOCTOBER 2013DURATION 45 MINS TOTAL MARKS: 100 Instructions to Students:The test consists of multiple choice questions only.1.Answer as many of the questions as possible.2.Choose the most correct answer in each case.3.Negative marks (-1) WILLbe scored for incorrect answers.4.Enter your answers on the MCQ Answer Sheet.5.Complete the Student number and Seat number blocks. Remember to fill in thesquares corresponding to your student number.6.All entries on the MCQ answer sheet MUST BE IN HB PENCIL. Entries in pen will not be recorded by the scanner and marks will thus be lost.7.Read each question fully before attempting to answer it.
1. You place R2000 in a bank that pays 4% interest at the end of each year. Howmuch will you have at the end of five years with annual compounding?(a) 504.12000(b) 05.142000;(c) 504.02000(d) 0816.12000;(e) 504.12000;;.2. You invest an amount today for four years that pays 6% annually. The bank compounds annually. At the end of the four years you will have R150. What amount must you invest today? 3. If savers require a 2% return and inflation is expected to be 3%, what rate will banks offer savers?