Perform Basic Mathematical Calculations and Manipulations - Mathematics Assignment Help

Assignment Task:

COURSE OBJECTIVES: 

CO1. Understand the basis and role of quantitative information for decision making in business and management. 

CO2. Perform basic mathematical calculations and manipulations, apply descriptive statistical methods and interpret the results. 

CO3. Use Excel to carry out calculations and produce diagrams for decision making in business.

PROBLEM-SOLVING EXERCISES: 3 PARTS- DUE END OF WEEK 3 

Part 1. Matt is saving for the 2021 Santos Tour Down Under in Adelaide. The trip is estimated to cost $3,500, inclusive of all tickets and accommodation. 

(a) Matt will set aside his birthday gift of $1,250 in a simple interest account, earning 3% at a local bank. What will be the accumulated amount after 9 months? (Hint: Round final answer to nearest cents) 

(b) Matt also has saved $1,300 which earned over the summer break. He would like to invest his savings in an interest-bearing account that earns interest at a rate of 3.1% per year compounded quarterly. What will be the accumulated amount of savings from summer break and birthday gift after 9 months? (Hint: Round final answer to nearest cents). 

(c) Alternatively, Matt’s bank manager thinks, Matt should immediately pool his money and invest the all amount in an account for the same time which pays interest at a rate of 2.8% per annum, compounded monthly. Matt is worried that 2.8% p.a. is a lower interest rate compared to the current arrangement and he will not have enough for his trip. What will be the accumulated amount after 9 months in this alternative? (Hint: Round final answer to nearest cents) problem solving exercises Part 1: Quantitative Methods for Business (MATH 1075) 

(d) Write a short paragraph (Use Text Box) advising Matt of his investment outcomes comparing both options, including any advice for a successful trip to Adelaide. 

Part 2. Mary would like to purchase a touring bike. After extensive research online and visiting at a few local bike shops, she decided to purchase the newly released carbon adventure bike for $4,000. 

(a) The first bike shop is currently offering a deal of 12 equal monthly repayments with no interest charges. What cash amount should the shop be willing to accept instead of the no-interest plan? By considering the current saving interest as 3% per year which compounded monthly. 

(b) Alternatively, another bike store (the second bike shop) offers the same no-interest plan but require a 4% deposit and an establishment fee of $20 both of which are payable immediately (at the time of purchase). The second store also charges an account keeping fee of $2.90 per month due with each payment. What cash amount should the second store be willing to accept with its no-interest plan on the same bike which ticketed at $4,000? In this case, you can assume the second store value money at 6% per year compounded monthly. 

(c) Which shop offers a better deal for Mary? Explain briefly (2-3 sentences).

Part 3. Steve owns a startup business that is currently operating from his parent's garage. He would like to rent out a small shop for his business. However, he does not have his capital to invest, so he will need to raise $15,000 for his new shop. 

Steve is considering taking a loan for the required amount for his shop. His local bank charges 7.5% per year compounded quarterly and requires quarterly repayments. The bank offered Steve a one-year interest-only option with his three-year loan. This offer means that for the first year, every quarter, Steve would pay only interest on the amount he borrowed. For the following years, the second and third year, loan repayments will consist of a principal (the original amount), plus interest. 

(a) Prepare an EXCEL spreadsheet that shows the end-of-the quarter balance in Steve’s loan account over the next three years. In addition, use your amortization schedule to calculate the total interest and the total amount paid over the life of the loan. Attach a copy your spreadsheet into your assignment submission.

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