Give your answers to parts (b), (c) and (d) to the nearest whole number.Harinder has 14 000 US Dollars (USD) to invest for a period of five years. He has two options of how to invest the money.Option A: Invest the full amount, in USD, in a fixed deposit account in an American bank.The account pays a nominal annual interest rate of r % , compounded yearly, for the five years. The bank manager says that this will give Harinder a return of 17 500 USD.Option B: Invest the full amount, in Indian Rupees (INR), in a fixed deposit account in an Indian bank. The money must be converted from USD to INR before it is invested.The exchange rate is 1 USD = 66.91 INR.The account in the Indian bank pays a nominal annual interest rate of 5.2 % compounded monthly.

* This question is from an exam for a previous syllabus, and may contain minor differences in marking or structure.

$17500=14000{\left(1+\frac{r}{100}\right)}^5$ (M1)(A1)

Note: Award (M1) for substitution into the compound interest formula, (A1) for correct substitution. Award at most (M1)(A0) if not equated to 17500.

OR

N = 5

PV =±14000

FV = $\mp$17500

P/Y = 1

C/Y = 1 (A1)(M1)

Note: Award (A1) for C/Y = 1 seen, (M1) for all other correct entries. FV and PV must have opposite signs.

= 4.56 (%) (4.56395… (%)) (A1) (G3)

[3 marks]

14000 × 66.91 (M1)

Note: Award (M1) for multiplying 14000 by 66.91.

936740 (INR) (A1) (G2)

Note: Answer must be given to the nearest whole number.

[2 marks]

$936740\times {\left(1+\frac{5.2}{12\times 100}\right)}^{12\times 5}$ (M1)(A1)(ft)

Note: Award (M1) for substitution into the compound interest formula, (A1)(ft) for their correct substitution.

OR

N =60

I% = 5.2

PV = ±936740

P/Y=12

C/Y= 12 (A1)(M1)

Note: Award (A1) for C/Y= 12 seen, (M1) for all other correct entries.

OR

N=5

I% = 5.2

PV= ±936740

P/Y=1

C/Y= 12 (A1)(M1)

Note: Award (A1) forC/Y= 12 seen,(M1)forallother correct entries

= 1214204 (INR) (A1)(ft) (G3)

Note: Follow through from part (b). Answer must be given to the nearest whole number.

[3 marks]