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DSC1630 ASSIGNMENT 1 SEMESTER | Questions And And Answers

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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 tha...

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  • July 13, 2022
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  • 2021/2022
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  • 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 (DSC1630)
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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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