A sponsor of the cricket club has invested $20 000 in a perpetuity.
The annual interest from this perpetuity is $750.
The interest from the perpetuity is given to the best player in the club every year, for a period of 10 years.
- What is the annual rate of interest for this perpetuity investment? (1 mark)
--- 3 WORK AREA LINES (style=lined) ---
- After 10 years, how much money is still invested in the perpetuity? (1 mark)
--- 1 WORK AREA LINES (style=lined) ---
- The average rate of inflation over the next 10 years is expected to be 3% per annum.
- Michael was the best player in 2014 and he considered purchasing cricket equipment that was valued at $750.
- What is the expected price of this cricket equipment in 2015? (1 mark)
--- 3 WORK AREA LINES (style=lined) ---
-
What is the 2014 value of cricket equipment that could be bought for $750 in 2024? Write your answer, correct to the nearest dollar. (1 mark)
--- 3 WORK AREA LINES (style=lined) ---