Unit 7 Test Finance VU = ; Ontario Virtual Name: School Part A - Knowledge and Understanding [10 marks] 10KU | 1071 | 10COM | 10 APP 1. Colin recently started a part-time job. He is saving to travel to Europe. He plans to deposit $500 at the end of each month into an account that pays 2.4% per year, compounded monthly. How much will Colin have saved at the end of eight months? (2 Marks) 2. Determine the present value of monthly car payments of $590 at 6.9% per year, compounded monthly for two years. (2 Mark) 3, What effect does each of the following have on the regular payment and the total interest paid on a mortgage? Provide an example for each. (6 Marks) a) Increasing the amortization period b) Making more frequent payments c) Making accelerated payments Unit 7 Test Finance = Part B Thinking [10 marks Ontario Virtual School 1. Mila will need $15 000 when she goes to college 5 years from now. She has 2 options for saving the money. Option A: Option B: A regular deposit at the end of each month A regular deposit at the end of each year into into an account that earns 5.5% per year an account that earns 6.1% per year compounded monthly (2 Marks) compounded annually (2 Marks) Which option should Mila choose? Make a recommendation, then justify it. (2 Marks) 2. Adrian wants to have $22 500 in 4 years to start a mechanic shop. He plans to save the money by making regular deposits into an annuity that earns 11.9% per year compounded semi-annually. What semi-annual deposits does Adrian have to make? (4 Marks)