2E

JoJo would have needed to live for at least 2 years in order for BetterLifeCo to break even on the
policy.

This is because JoJo will have paid $125 per week for 52 weeks in a year for 2 years, which totals to
$52,000. BetterLifeCo will only have to pay out $1,000,000, which is less than what JoJo has paid in.

3D

Size of fortnightly payments during the P&I phase of 3 years= $430.31

Calculation using TI BA II Plus calculator:

Set END

P/Y= 26, C/Y= 26

N= 3*26= 78

I/Y= 7.54

PV=- 30,000

FV= 0

CPT PMT= 430.3089937

3E
The total amount Priya owes two years after she took out the loans is $21,836.40.

$10,000 @ 10.08% for 2 years = $10,836.40

$11,000 @ 5.4% for 2 years = $11,000.00

$21,836.40

2C
Explanation:
Weakly interest rate = 0.1905%

Answer:

B) Future value =713355.79

C) Difference = 286644.21
WHOLE SOLUTION TO QUESTION 1