MAT133Y5Y

Assignment 1- Fall 2023

Due: September 29, 2023 at 11:59pm via CrowdMark.
Late assignments will not be accepted.
Unless otherwise stated, you must show your work.

Before continuing, ensure that you read the Expectations on Student Writing. Poorly written assignments, even
those whose content is ostensibly correct, will receive a poor mark or a mark of zero. If you are uncertain as to what
qualifies as good writing, do not hesitate to seek out the advice of a course instructor or teaching assistant.

Question 1. Sally, a UTM student, rents a room at a rate of $1300 per month starting in September 1, 2023 and
plans to live there for 4 consecutive years. The landlord increases the rent by 2.5% every twelve months.
Also on September 1, 2023, Sally receives her student loan disbursement of $20,000, and she plans to use this amount
exclusively for rent payments.

(a) How much money in total will Sally pay for rent throughout the 4 consecutive years?
(b) If Sally receives $20,000 every September in student loans for all 4 years, how much money will she have left over
for other expenses over the four years, after paying her rent?

Question 2. A new kind of savings account at your bank earns interest in the following way:

• The account earns interest at a rate of r at the end of every 6-month period; and

• The account earns interest at a rate of s at the end of every 4-month period.

(Note: These rates are not APRs.)

In other words, assuming an initial deposit on January 1, the account first earns r in interest at the end of June,
then again in December, and so on; while it first earns s in interest at the end of April, then again in August, and
so on.
Suppose that you make a deposit of P dollars into this account on January 1, 2024, and another deposit of P dollars
on January 1, 2025. Assume that you are only allowed to withdraw at the end of every 12-month period.

(a) Write an expression that represents the future value S of the account on January 1, 2029. Your answer may
depend on r, s, and/or P .
(b) Use (a) to compute the amount P required so that the account has S = $10,000 after 5 years. Your answer may
depend on r and/or s.
(c) Instead of $10,000, suppose you wanted to triple your initial deposit P instead. How many years do you need to
wait for the account to grow to three times the initial deposit P ? Your answer may depend on r, s, and/or P .