Instructions to students:
All questions are compulsory.
Dictionaries are not permitted.
A 3-month deposit account pays a rate of interest of 5% per annum convertible half-yearly.
Calculate the simple rate of discount per annum which is equivalent to the above investment over the 3-month period. (3 marks)
An investor pays £1,200 per annum into a savings account for 10 years, and increases the payments to £1,500 per annum for the next 5 years. The payments are made annually in advance.
Calculate the accumulated amount in the savings account at the end of the 15 years if the investor achieves a yield of 6% per annum convertible half-yearly on her investment.(4 marks)