172 views

Uploaded by 1234x3

Past exam

- FINS1612 Exam Notes
- ECON1102 Complete Notes
- ECON2102 Tutorial 3
- ECON1203 Hw Solution week09
- Practice Questions
- ECON 1202- Problem Set 1
- UNSW BCom Review
- ECON1102 Final 2010F Practice
- Econ2102 Midtermexam Questions and Answers
- Comprehensive Example Answers_2011
- 2014S1 PracExamQuestions Answers
- acct1511 final version
- cguide10b
- 2015S1 Practice Final Exam Questions Solutions
- Fins1613 Notes
- Fins2624 Notes
- ECON1102 Midterm 2010W Pieters Practice 2
- Tut Sol Week13
- ECON1203 Hw Solution week08
- Tut eBook Let s1 2011 13th Ed

You are on page 1of 8

SCHOOL OF ECONOMICS

ECON1202IECON2291

QUANTITATIVE METHODS A

FINAL EXAMINATION

NOVEMBER 2004

There are SIX questions in this examination.

Attempt all six questions.

All questions are NOT of equal value.

The examination is worth a total of 65 marks.

Time allowed: 3 HOURS

Candidates may use their own calculator. It should not have an alphabetical

keyboard, it should not be a graphic, programmable or financial calculator

and hand-held computers are not allowed.

Graph paper will be provided.

All answers must be written in ink. Except where they are expressly

required, pencils may be used only for drawing, sketching or graphical work.

All working must be shown. Rounding errors will not be penalised.

This paper may be retained by the candidate.

A

B

c

D

E

!

I

,I

1 [PROBLEM 1

I

I

2 I

I

i

I

3 !

4 The Healthtime Medical Centre borrows $520,000 it needs to install a new magnetic

5 ! resonance imager. Interest is charged on the loan at an effective annual rate of 12%.

6 I Equal repayments are to be made at the end of each year for the next 5 years,

7 !the first yearly repayment being made exactly one year after the loan is received.

8 I

9 I LOAN AMORTISATION TABLE

10 I

I

I

I

11 ILOAN AMOUNT

520000 '

I

I

12 iEFFECTIVE ANNUAL RATE i

-0.12

13 IOF INTEREST

I

14 I NUMBER OF YEARLY

I

I

I

15 I REPAYMENTS

5

-II

16 :

I

17 .

I YEARLY

[INTEREST PRINCIPAL

PRINCIPAL

18 I

REPAYMENT I

iREPAID

OUTSTANDING

YEAR END OF YEAR I

BEGINNING OF YEAR

19 I

i

20 I

I

21 i

1

I

2

22

I

I

3

23

I

--cI

4

I

i

24

25 I

5

I

26 I

I

I

FINANCE CHARGE

271

I

!

28 I

i

29 [

I

30 Using cell addresses as much as possible to enter the appropriate formulae into the

31 [above loan amortization table of an EXCEL spreadsheet, how would you type the

-!

32 iformulae to be entered in

I

331

I

I

34 [(i) Cell B21 (to obtain the yearly repayment) ?

(1.5 marks)

[

35 I

36 I (ii) Cell C21 (to obtain the interest component in the first repayment)?

1(0.5 mark)

-I

I

37 .

I

!

-------38 ! (iii) Cell D21 (to obtain the principal repaid in the first repayment)?

(0.5 mark)

---39 I

i

40 I (iv) Cell E23(to obtain the principal outstanding at beginning of year 3)?

(1.5 marks)

-!

41 !

I

I

i

42 I(v) Cell B27 (to obtain the finance charge) ?

(1 mark)

I

43 i

I

I

I

I

441

i

I

I

I

--45 [YOU MUST WRITE YOUR ANSWERS TO THE ABOVE IN YOUR EXAM BOOKLET.

46 I

i

I

i

47 i N.B. NO MARKS WILL BE AWARDED IF ANSWERS GIVEN ARE IN TERMS OF

48 INUMBERS THAT WILL ACTUALLY APPEAR IN THE SPREADSHEET.

I

-r

49 !

II

I

50 '

[

I

[

~--~-

PROBLEM 2

(a). An individual has a debt of $ 5,000 due in 3 years with interest

charged at the rate of 5 % per annum compounded annually on this first

debt and another debt of$ 10,000 due in 4 years with interest charged

at 6 % per annum compounded annually on this second debt. She wants

to pay offthese debts by making 2 payments : the first payment now

and the second payment, which is twice the first payment, in one year's

time. If the rate of interest for these payments is 8 % per annum

compounded daily, what is the amount of the first payment? Give

your answer to the nearest dollar. (3 marks)

(b). A financial consultant offers a choice between the following 2

retirement plans, A and B, to a 25 year old person concerned about how

he will fare financially when he retires at the age of 65 years old. The

first plan A involves contributing as from now $ 3,000 per year for 10

years and then makes no further contributions after age 34, leaving the

accumulated sum alone and untouched until retirement at age 65. The

second plan B involves doing nothing until he reaches age 35 when he

starts contributing $ 3,000 per year until retirement at age 65 (a total of

30 yearly contributions). Assuming an effective annual rate of interest

of 6 % over the whole period, and supposing that all the contributions

are made at the beginning of each year, calculate the net earnings at age

65 for the 2 retirement plans. Net earnings is defined as the future or

compound amount minus the total contributions. Which of the 2 plans

A and B yields the higher net earnings? (3 marks)

(c). A manufacturing company wishes to borrow money from its

commercial bank in order to buy capital equipment costing

$ 1,000,000 which is estimated to have a productive life of 5 years

and a scrap value of $ 100,000. If such capital equipment is bought, the

company will be able to save $ 20,000 at the end of each month for 5

years. Assuming the rate of interest is 12 % per annum compounded

annually and using the net present value approach, will it be worthwhile

and profitable for the company to invest in the capital equipment or

not? (3 marks)

PROBLEM 3

(a).

[XC + B-1r l = C-1AC, find X in terms of A,B and C, showing all

the steps in your working. (1 mark)

(ii) If A =

[~

:J,

B=

[~ ~Jand C = [~

(3 marks)

(b). Using the adjoint method, find the inverse of the following matrix:

(3 marks)

Deluxe, Premium and Superior, which must be cut, assembled and

finished. Each Deluxe type of mattress requires 3.2 hours of cutting, 4

hours of assembling and 1 hour of fmishing. Each Premium type of

mattress requires 4 hours of cutting, 6 hours of assembling and 1 hour

of finishing. Each Superior type of mattress requires 4.8 hours of

cutting, 8 hours of assembling and 2 hours of finishing. If the

manufacturer has 192 hours of cutting per day, 312 hours of assembling

per day and 74 hours of finishing per day, using any matrix method of

solution that you know, determine the number of mattresses of each of

the types that can be produced per day, assuming all available cutting,

assembling and finishing hours are used in the production ofthe

mattresses. (4 marks)

PROBLEM 4

alpha and beta models. To manufacture the mobile phones, 3 processes

known as assembling, connecting and packaging are required. Each alpha

model needs 4 hours of assembling, 2 hours of connecting and 2 hours of

packaging whilst each beta model needs 2 hours of assembling, 2 hours of

connecting and 6 hours of packaging. The company has 700 hours of

assembling capacity per week, 500 hours of connecting capacity per week,

and 900 hours of packaging capacity per week. The company makes a profit

of$ 50 on each alpha model sold and $ 70 on each beta model sold. The

objective of the company is to maximize its profits. Assume all mobile

phones manufactured per week are all sold in the same week.

(i)

Formulate the objective function and all the constraints of the above

problem. (3 marks)

(ii)

Draw a graph marking clearly the feasible region and showing at least

one iso-objective line. (3 marks)

(iii)

order to maximise the profit of the mobile phone company. What is

the maximum profit? (3 marks)

(iv)

With other constraints remaining the same, what will happen to the

maximum value of the objective function if

(l)the assembling hours are increased to 800 hours? (1 mark)

(2)the connecting hours are increased to 600 hours? (1 mark)

(3)the packaging hours are increased to 1,000 hours? (1 mark)

PROBLEM 5

H-C

E=-H

where Hand C are the absolute temperatures of the hot and cold

reservoirs respectively. Find (i) the limit ofE as C tends to Hand

(ii) the limit ofE as C tends to zero.

(1 mark)

(b). For a soccer ball manufacturer, the costs of labour and raw materials

incurred for making each soccer ball are $ 30 and $ 10 respectively.

The overhead or fixed costs are $ 20,000 per week. If more than 5,000

soccer balls are made each week, the labour costs rise to $ 45 per

soccer ball for those units in excess of 5,000 whilst the raw materials

costs remain unchanged. What is the level of production that will

minimize the average cost of production of a soccer ball? (2.5 marks)

dq

Determine the average revenue equation faced by the producer.

(1.5 marks)

(d). The inverse demand function of a product is given by

200

p = ----;=====

~6000+10q2 .

inelastic at this point? (2 marks)

6

(e). In Aussialand, initially, there are 1,000 million dollars of paper money

in circulation. The central government decides to issue new paper

money; whenever the old paper money comes into the banks, it is

destroyed and replaced by new paper money. After only 5 weeks, 200

million dollars of new paper money are circulating in the country.

Let x millions of dollars be the amount of old paper money in

circulation at time t (in weeks). If the rate of change in x with respect to

time is proportional to x, how long will it take for 80 % of the old paper

money to be replaced by the new paper money? Give your answer to

the nearest whole number. (3 marks)

production of its chocolates per worker follows limited growth with its

present resources. The upper limit of production is 500 chocolate bars

per day per worker. Currently, output per day per worker is 200

chocolate bars and in a month's time, the daily output per worker will

increase to 300 chocolate bars. What will be the daily output per

worker in 3 months' time? Give your answer to the nearest whole

number.

(3 marks)

PROBLEM 6

(a). A production function is given by Q = K~L where Q = output,

K = amount of capital used and L = amount of labour used.

(i)

labour respectively. (1 mark)

a2 Q a2Q a2Q

aK 2 ' aL2 ' aKaL

(2 marks)

(iii)

constant.

(1 mark)

obtained from the sale of a crop of potatoes grown in an artificially

heated greenhouse is given by R = 5x(1-e-Y) where x is the temperature

in degrees Celsius maintained in the greenhouse and y is the amount of

fertilizer applied per square metre of cultivated ground. The cost of

heating is 0.lx2 dollars per square metre and the cost of fertilizer is 20y

per square metre. Determine the temperature and the amount of

fertilizer which will maximise the profit per square metre. You must

check the second order conditions for a maximum. (6 marks)

(c). The labour and materials used for building a rectangular container used

for shipping purposes cost $ 300 per square metre for the top and

bottom parts and $ 200 per square metre for the sides of the container.

The shipping container must have a volume of 12,000 cubic metres.

Use the Lagrange Multiplier method to determine the dimensions of

the container which will minimise the costs. What is the minimum

cost? Assume the second order conditions for a minimum are present.

(5 marks)

- FINS1612 Exam NotesUploaded byssssccccc
- ECON1102 Complete NotesUploaded byJustin
- ECON2102 Tutorial 3Uploaded byErnest Tang
- ECON1203 Hw Solution week09Uploaded byBad Boy
- Practice QuestionsUploaded byCatherine Wu
- ECON 1202- Problem Set 1Uploaded byneelpatel3415
- UNSW BCom ReviewUploaded byEdward Yang
- ECON1102 Final 2010F PracticeUploaded byexamkiller
- Econ2102 Midtermexam Questions and AnswersUploaded byGorge Soros
- Comprehensive Example Answers_2011Uploaded by1234x3
- 2014S1 PracExamQuestions AnswersUploaded bykelvin
- acct1511 final versionUploaded bycarolinetsang
- cguide10bUploaded byrodgedog
- 2015S1 Practice Final Exam Questions SolutionsUploaded byKate Sparks
- Fins1613 NotesUploaded byasyunmwewert
- Fins2624 NotesUploaded byKevin Yu
- ECON1102 Midterm 2010W Pieters Practice 2Uploaded byexamkiller
- Tut Sol Week13Uploaded byfindhero
- ECON1203 Hw Solution week08Uploaded byBad Boy
- Tut eBook Let s1 2011 13th EdUploaded byCamilia Zhang
- Tut Sol Week12Uploaded byAAA820
- ECON2206 AssignmentUploaded byJoni Lee Carling
- All MCQ for Thompson 5eUploaded byLindaLindy
- ACCT1501s106 2006 questionsUploaded byAnjewGS
- 2015S2 PracExamQuestionsUploaded byYe Viola Liu
- Fins1613 NotesUploaded byMonica Aggarwal
- Week 4.Uploaded byShant Paul
- Final S1 2012 ECON2101 Review Questions Weeks 7 to 12 With Solutions(1)Uploaded byJason Pan
- ACCT1501 2014S2 Final Exam AnnouncementUploaded byDavyZhou
- ACCT1501s105 Past PaperUploaded byAnjewGS

- BehavioralQuestions.pdfUploaded by1234x3
- ECON1202 Quantitative Analysis for Business and Economics 2014Uploaded by1234x3
- Trotman WebSM CH14 4th EditionUploaded by1234x3
- ECON1202 2004 S2Uploaded by1234x3
- Accounting FirmsUploaded by1234x3
- Week 2 Preparation Questions SolutionsUploaded by1234x3
- MGMT1001 Course Outline s1 2012 - 23rd FebUploaded by1234x3
- Comprehensive Example Answers_2011Uploaded by1234x3
- Trotman WebSM CH01 4th EditionUploaded by1234x3

- Train Law QuestionsUploaded byGilleane
- Financial Appraisal of Project Sbi Project Report Mba FinanceUploaded byPiya Sharma
- GMI Consolidated FS Q3 2017Uploaded byDiego Brandeau
- Miscellaneous Amusement Recreation Industries 71399Uploaded byDataGroup Editorial
- 01 PartnershipUploaded bydom baldemor
- Credit Union Insurance Corporation v. United States, 86 F.3d 1326, 4th Cir. (1996)Uploaded byScribd Government Docs
- Pacific Gas and Electric Company - September 2018 ETUploaded byGenability
- ManagerUploaded byapi-122237950
- SampleUploaded byRehan Siddiqui
- Real Estate Agent Profiles & Home Services 2016Uploaded bytimesnewspapers
- Strong. Modelling Abnormal Returns a ReviewUploaded byMurtaza Khan
- Labour Remuneration SchemesUploaded byAbu Ashraf Quader Iqbal
- Straw Man RevealedUploaded byRa El
- UllrichDayTradingS&PIndex[1]Uploaded bysri
- Financial Peroformance of Transcom Electronics LtdUploaded bySharifMahmud
- AFP Pay Schedule 2002Uploaded byherbs22225847
- Kaplan Professional - Financing Secrets of a Millionaire Real Estate Investor - 2003Uploaded byanon-197187
- 236. International Corporate Bank v GuecoUploaded byBenedict Alvarez
- How to Find Funding NowUploaded byFundica.com
- Bid Palem Admin BuilUploaded byRevathi Rajesh
- Checklist for VAT Rate Changes in SAP _ Tax Management ConsultancyUploaded byfairdeal2k1
- Richard Koo Explains Why An Unwind Of QE2, With Nothing To Replace It, Could Lead To The Biggest Depression YetUploaded bymrwonkish
- Counterparty default – the legal issues_Habib MotaniUploaded bykrystle_blue121335
- Zero BudgetingUploaded byBalu Mahendra Susarla
- 351 Second Superseding IndictmentUploaded byjmaglich1
- Michigan Last Will and Testament TemplateUploaded byLaura Khalil Abadir
- IMF - Portugal First ReviewUploaded byrryan123123
- OCDE - "Offshore Voluntary Disclosure" - September 2010Uploaded bychequeado
- Bosque Et Al v. Wells Fargo Bank, N.A. - ComplaintUploaded byrichdebt
- L&T DemergerUploaded byAmit Mehra