BUSI1003 – Business Mathematics
Winter 2020
 
 
NAME:____________________
STUDENT ID:_______________
 
Rules:

  • The answered assignment should be in an MS word file format.
  • The assignment should be submitted electronically by the above due date.
  • No hard copies of the assignment will be accepted.
  • Ensure that your COMPLETE final answer is clearly written in the box provided.
  • Ensure that your process is clearly shown and logical. Unclear or vague workout will result in deduction of marks

4 decimal places for workout process and answers except for answers in dollars.  Answers in dollars must be in 2 decimal places. All decimal places require in-class discussed rounding procedure
 
 
Individual Project (10%):
Total: 40 marks
Instructions
Please show your work in order to earn part marks.
Answers must have correct units.
Accuracy should be to the nearest dollar, percentages to the nearest 0.1%, and decimal equivalents to the nearest 0.0001.
The assignment should be submitted in document format.
Each of your final answers should be in statement form with correct notation.

Case Study – Planning Ahead

Precision Machining Corporation has been growing steadily over the past decade. Demand for the company’s products continues to rise, so management has decided to expand the production facility; $2 800 000 has been set aside for this over the next four years.
Management has developed two different plans for expanding over the next four years: Plan A and Plan B. Plan A would require equal amounts of $750 000, one year from now, two years from now, three years from now, and four years from now. Plan B would require $300 000 now, $700 000 one year from now, $900 000 two years from now, and $975 000 four years from now.
The company has decided to fund the expansion with only the $2 800 000 and any interest it can earn on it. Before deciding which plan to use, the company asks its treasurer to predict the rates of interest it can earn on the $2 800 000. The treasurer expects that Precision Machining Corporation can invest the $2 800 000 and earn interest at a rate of 4.5% p.a. compounded semi-annually during Year 1, 5.0% p.a. compounded semi-annually during Years 2 and 3, and 5.5% p.a. compounded semi-annually during Year 4. The company can withdraw part of the money from this investment at any time without penalty.
 
 
Question #:_______1_______(10 Marks)
Question #:_______2_______(10 Marks)
Question #:_______3_______(10 Marks)
 
Question #:_______4_______(10 Marks)