North Sydney Girls 2017 2U T ri2ls

Rhonda takes out a loan for $48 000 o n terms where no repaym ents are made
for a year and then eq ual monthly repayments are made for a further 3 years.

Interest is compounded at 1. 5% per month on the current monthly balance for

the full duration of the loan (including the time when no repayments are m ade).
The repaym ent ($N) is deducted each m onth before the interest is calculated.

(i) Show that the am ount still owing 15 months after the loan is taken out 2
is given by:

48000 (1.01 5)'5 - N(l.015 + 1.015 2 + 1.0 15 3 ).

(ii) Calculate the value of the monthly repayment $N, to the nearest dollar. 3
Sydney Boys 2007 2U

Richard won the NSW Lotto on the I st January 2000. The prize was one
million dollars. He decided to deposit the entire amount into an account
which paid interest at a rate of 8% per annum. The interest was calculated
quarterly and compounded quarterly. Richard then made an annual
withdrawal $50000, starting on the 1si January 200 l.
(i) Write down an expression for the amount in Richard's account
2
immediately after his first withdrawal.
(ii) Show that the amount in Richard' s account immediately after his
third withdrawal is given by the expression: 3
4
106 x 1.0i 2 - 50000(1 + 1.02 + 1.088 )

(iii) How much, to the nearest dollar, was left in Richard's account
after his twentieth withdrawal.
Syd ney Boys 2013 2U

George has inherited a sum of $80 000. He deposited it in the bank in

an account earning five percent per annum interest compounded

annually. He enjoys an annual European holiday and plans to withdraw

$10 000 at the end of each year to finance his holiday.

Let A,, be the amount in the account after n years.

(i) Show that

~ = 80000(1.05)3 - 10000(1.05)2 - 10000(1.05) - 10000 2

(ii) Find an expression for An .

(iii) Calculate the number of annual holidays George will be able

to fully finance from his account. 3