Question

Activity 3 A course at university costs R10 000 rand. If a father wishes to send his daughter to do this in five years' time, what will it cost him if the rate of inflation is estimated to be 11,5% p.a.? ​

Answer 1

R17,974.03 (round according to directions)

Explanation:

To calculate the future cost of the course in five years' time, taking into account the estimated inflation rate of 11.5% per year, we can use the formula for compound interest.

The formula for compound interest is given by:

A = P * (1 + r)^n

Where:

A = the future value (cost of the course in five years)

P = the present value (current cost of the course, which is R10,000)

r = the annual interest rate (in decimal form)

n = the number of years

In this case:

P = R10,000

r = 11.5% = 0.115 (converted to decimal form)

n = 5 (years)

Now, let's calculate the future cost (A):

A = 10000 * (1 + 0.115)^5

A = 10000 * 1.797402587890625

A ≈ 17974.03

So, the cost of the course in five years' time, with an estimated inflation rate of 11.5% per year, will be approximately R17,974.03.

Answer 2

12 is the answer for this