Simple interest
Task 1
Deposit on savings account increased in course of the year for the period
16th May - 28th September by CZK 20,000.00 at interest rate 3.5% p.a.
What is its amount as at 16th May 2008? Calculate time by method 30E/360.
Task 2
A merchant bank decided to deposit a part of its mad money in treasury bills
with total face value CZK 10,000,000.00 and maturity 182 days (26 weeks) offered for
CZK 9,720,000.00. After 119 days (17 weeks) the bank sold the bills to an investment
company that needed 63 days (i.e. 9 weeks) before planned investment to locate
suitably the ready amount and it was ready to pay for the treasury bills CZK 9,920,000.00.
Was the sale of treasury bills advantageous to the bank? Identify annual discount rates.
Note: Yield on treasury bills is calculated on discounted basis. Thus,
although the bills are issued e.g. in the value of CZK 1 million, they are sold so-called
"below par", i.e. for the price under face value.
The yield is just the difference between face value (paid at maturity) and issue
price (possibly purchase cost).
Task 3
Current account balance developed in course of the year according to the table
as follows. The task is to execute its annual balance if credit limit amounts
to CZK 30,000.00, credit interest rate 0.3%, debit interest rate 15.2%,
commission for credit limit excess 5% and annual fee for operation of the
account CZK 400.00. In the calculations, apply standard ACT/360.
Tab.: Development of current account
| Date |
Revenues to the account (CZK) |
Expenses to the account (CZK) |
Balance
(CZK) |
| 21. 1. |
1 000 000 |
- |
1 000 000 |
| 15. 3. |
- |
700 000 |
300 000 |
| 27. 4. |
- |
400 000 |
-100 000 |
| 28. 6. |
250 000 |
- |
150 000 |
| 3. 10. |
- |
200 000 |
-50 000 |
| 13. 11. |
30 000 |
- |
-20 000 |
| 5. 12. |
500 000 |
- |
480 000 |
| 31. 12. |
- |
- |
480 000 |
