ì�¬ë³¸ - QMBus Final s207 marking

# ì�¬ë³¸ - QMBus Final s207 marking - AUSTRALIAN...

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AUSTRALIAN SCHOOL OF BUSINESS COMM5005 QUANTITATIVE METHODS FOR BUSINESS FINAL EXAMINATION MARKING GUIDE NOVEMBER, 2007 Part B Problem 1 (8 marks) Suzie and Sam are currently renting an apartment but would like to buy a house five years from now to accommodate their family. They can save \$450 at the end of each two weekly pay period, placing this amount into an investment account which earns 6.25% p.a. compounded fortnightly. After one year the interest rate falls to 5.8% p.a. so they adjust their deposits to meet their original savings target at the end of year 5. (a) What is the amount of the savings target? 11 130 0.0625 450 26 5 130 0.002404 26 (1.002404) 1 450 \$68,576.13 0.002404 Rn r S == × = ( 1 m a r k ) (b) How much will need to be saved per fortnight after the interest rate drops to meet this target? After one year amount saved is 26 1 1.002404 1 450 \$12,058.42 0.002404 S (1 mark) The value of this at year 5 with

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() 22 104 2 0.058 0.002231 26 4 104 26 12,058.42 1.002231 \$15,203.18 rn S == = × = ( 1 m a r k ) Remaining amount to be saved is 32 68,576.13 15,203.18 \$53,372.95 SS S =− = = ( 1 m a r k ) New repayments are 2 104 53372.95(0.002231) \$456.54 (1.002231) 1 R ( 1 m a r k ) At the end of five years Suzie and Sam use their savings as deposit on a house costing \$418,000 and take out a mortgage over 20 years with equal repayments made at the beginning of each month and interest of 9.2% p.a. (c) How much will each of their repayments be? 418,000.00 68,576.13 \$349,423.87 A = (1 mark) 240 349,423.87(0.007667) \$3,164.68 (1 (1.007667) )(1.007667) R = = (1 mark) (d) What advice would you give the couple about their savings plans now if you knew they required a house costing this much in five years time? The repayments per month on the loan are approximately 3.5 times the amount being paid into their savings scheme. Unless their financial commitments are heavy now and will be lighter in five years, or unless their income will be greater in five years time, it would be more sensible to save more per fortnight now. ( 1 m a r k ) Problem 2 (4 marks) 2
The racing industry has been badly affected by a virus which infects horses. An inquiry finds that the total number of animals infected N is given by the formula 0.35 10 . 6 t M N e = + where M is the maximum number of animals in an area and t is the time in days since the virus was introduced.

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ì�¬ë³¸ - QMBus Final s207 marking - AUSTRALIAN...

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