1. Christine Lugtu

2. 1. Your wage is $70,000 per annum from which you pay tax; calculate the tax to the nearest dollar. 2. After Subtracting the tax from your wage, calculate your monthly take home wage. Tax Subdivision % tax payable (marginal rate) 1 0 - 6,000 Nil 2 6,001 - 35,000 15c for each $1 over $6,000 3 35,000 - 80,000 $4,350 plus 30c for each $1 over $35,000 4 80,001 - 180,000 80,001 - 180,000 $17,850 plus 40c for each $1 over $80,000 70,000 – 35,000 = 35,000 35,000 x 0.3 = 10,500 10,500 + 4,350 = $14,850 Tax = $14,850 70,000 – 14,850 = 55,150 55,150 ÷ 12 = 4,595.83 Monthly take home wage = $4,595.83

3. 3. You purchased a motor bike for $5,000 and sold it for $4,000. Did you make profit or loss? How much profit or loss you made in percentage? 5.000 – 4,000 = 1,000 loss 1000 x 100 = 20% 5000 20% of loss 4. Assume that 8% of your annual income is $4,000, what is your actual annual income? 4,000 x 8 = $320 100 Actual annual income = $320

4. 5. Find out the house price and set up a loan over 25 years and make monthly payments on this loan. Assume the current interest rate is 5% per annum compounding monthly. Calculate the money owed after 25 years. House price = $250,000 Monthly compounding rate = 5 = 0.42 12 P = 250,000 R = 0.42 T = 25 years / 300 months Money owed after 25 years = $879032.88 $879032.88

5. 6. Purchase a car on hire purchase without a deposit. For convenience make monthly repayments for 3 years at 8% rate of interest per annum at simple interest. What would be the monthly repayment? Car price = $45,000 P = 45,000 R= 8 T= 3 years / 36 months PRT 100 = 45000 x 8 x 36 100 = 10800 ÷ 12 = $900 Monthly repayment = $900

6. 7. You planned to invest $8500 in a term deposit. You had two investment plans from which to choose: Plan 1: Simple interest at 5% per annum Plan 2: Compound interest at 5% per annum compounding every six months a) Calculate the total interest earned if you invested your money using Plan 1 for a year. b) Calculate to the nearest cent, total interest earned if you invested your money using plan 2 for one year. Total interest earned

7. c) Calculate the simple interest rate that would provide the same total interest as earned under plan 2 for an investment of $8500 for a year. Give your answer correct to two decimal places. = 0.06 + 5 = 5.06 PRT 100 5.06 x 8500 x 1 100 $430.10