DSC1630 ASSIGNMENT 1 SEMESTER | Questions And And Answers
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DSC1630 (DSC1630)
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University Of South Africa
DSC1630 ASSIGNMENT 1 SEMESTER 1 - 2020 | Questions And And AnswersDSC1630 ASSIGNMENT 1 SEMESTER 1 - 2020 DUE: 28 FEBRUARY 2020 2 Question 1 Precious borrows money from Steven at a simple discount rate of 9,75% per year. She must pay him R35 000 in 27 months’ time. The amount of money that she rec...
dsc1630 assignment 1 semester 1 2020 764907| questions and and answers dsc1630 assignment 1 semester 1 2020 764907 due 28 february 2020 2 question 1 precious borrows money from steven at a simpl
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DSC1630 ASSIGNMENT 1
SEMESTER 1 - 2020
764907
DUE: 28 FEBRUARY 2020
1
,Question 1
Precious borrows money from Steven at a simple discount rate of 9,75% per year. She must
pay him R35 000 in 27 months’ time. The amount of money that she receives from Steven
now is
[1] R42 678,13.
[2] R28 703,23.
[3] R28 389,51.
[4] R44 835,87.
[5] R27 321,88.
This is a simple discount calculation as the term discount rate is found in the
question. The formula for simple discount is P = S(1 − dt).
Given are the future value of the loan (S) which is R35 000, the time period which
equals 27 months and the discount rate (d) of 9,75%. The time period that we use
must always be in years.
As the given time is in months we change it to a fraction of a year by dividing the
months by the number of months in a year which is 12. Thus t = Now we need to
determine the present value of the loan. Thus:
P = S(1 − dt)
= 35 000 (1 – 0.0975 × )
= R27 321.875….
2
, Question 2
On 29 March 2020, Frieda deposited R3 500 into a savings account. The simple interest rate
agreed upon was 7,5% per year. The accumulated amount in the savings account on 10
October 2020 is
[1] R3 643,09.
[2] R3 649,06.
[3] R3 637,88.
[4] R3 640,24.
[5] none of the above.
3
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