Financial Math

When listing on the JSE ( Johannesburg Stock Exchange), JPe Ltd. wishes to have a full subscription and a successful share issue. The company values its shares at R50 a piece,Expert investors and insiders value the share at R44 a piece, at what price should JPe Ltd. offer their shares in order for them to have the best chance of a full subscription

Financial Math

You deposit $3000 into a bank account that compounds interest quarterly. If the APR is 2.5%, how much will you have in 5 years? Round to the nearest dollar, no commas. *

Financial Math

A company took to linear regression analysis to estimate their sales for the coming year,based on past sales, the company obtained the following equation in the format Y=a+bx: Y=0,5x+20 units in millions. If the equation was for the 10th period in the series, what would the estimate be for the coming year period 11?

Financial Math

Johan wants to buy a car for R550 000. He must pay a 10% deposit and take out a loan for the remaining amount. The interest rate on the loan is 8% pa compounded monthly over a period of 7 years.

2.1.1 Calculate the value of the deposit. (1)

2.1.2 Calculate his monthly payment. (5)

2.1.3 Johan thinks the loan will have an annual effective interest rate of 8,3%. Is Johan correct? Motivate your answer.

2.1.1 Calculate the value of the deposit. (1)

2.1.2 Calculate his monthly payment. (5)

2.1.3 Johan thinks the loan will have an annual effective interest rate of 8,3%. Is Johan correct? Motivate your answer.

Financial Math

Consider the following series: 5 + 8 + 11 + 14 +...+164

1.1.1 Calculate the number of terms in the series. (3)

1.1.2 Calculate the sum of the series. (3)

1.1.3 Express the series in sigma notation.

Financial Math

Carl Hightop, a popular basketball player, has been offered a two-year salary deal. He can either accept $2,300,000 now or accept monthly amounts of $100,000 payable at the end of each month. If money can be invested at 5.6% compounded semi-annually, which option is the better option for Carl and by how much?

The option is better by $?

The option is better by $?

Financial Math

SIMS lecturer has 3 options on repayment for a KES 25Mn - 20yr mortgage. He can make payments

monthly, quarterly or half yearly. For an effective annual rate of interest 9% calculate the total interest

that will be paid in each of the 3 options over the 20-year period.

monthly, quarterly or half yearly. For an effective annual rate of interest 9% calculate the total interest

that will be paid in each of the 3 options over the 20-year period.

Financial Math

Mr. Mike has a savings account with first deposit of $1200 and afterwards deposits $56 a week. Compute the value of the account at time t > 0 assuming the bank pays 8% interest compounded without a pause.

Financial Math

The force interest is given by (t)={0.04,0<t</=1 0.05t-0.01,1<t</5 0.24,t>5

What is the accumulated value at anytime (t>0)of investment of 1 at times 0,4 and 6?

What is present value at time, t =0 of a payment stream paid at a rate of p(t)=5t-1 received between t=1 and t=5

Financial Math

Liabilities of RM100 each are due at the ends of periods 1 and 2. There are three securities available to produce asset income to cover these liabilities, as follows:

i) A bond due at the end of a period 1 with coupons at rate 0.01 per period, valued at a periodic yield of 7%.

ii) A bond due at the end of the period 2 with coupon rate 0.02 per period, valued at a periodic yield of 7.5%.

iii) A bond due at the end of period 2 with coupon rate 0.2 per period, valued at a periodic yield of 7.75%.

Determine the cost of the portfolio that exactly-matches asset income to liabilities due using:

a) bonds i) and ii) only.

b) bonds i) and iii) only.

(c) Which combination minimizes the cost of exact-matching portfolios made up of a combination of the three securities?

i) A bond due at the end of a period 1 with coupons at rate 0.01 per period, valued at a periodic yield of 7%.

ii) A bond due at the end of the period 2 with coupon rate 0.02 per period, valued at a periodic yield of 7.5%.

iii) A bond due at the end of period 2 with coupon rate 0.2 per period, valued at a periodic yield of 7.75%.

Determine the cost of the portfolio that exactly-matches asset income to liabilities due using:

a) bonds i) and ii) only.

b) bonds i) and iii) only.

(c) Which combination minimizes the cost of exact-matching portfolios made up of a combination of the three securities?