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2.4Mr Seboko want to visit his brother who is overseas in 5 years' time. He invested R80 000 in a saving account in order to save up for his trip. The interest rate is 10, \( 5 \% \) per annum compounded annually.at the end of the 3 rd year he encounter financial difficulty and withdraw R15 000 from the account, 6 months later after the withdrawal he add R10 000 into the same investment and the interest was now \( 17 \% \) compounded quarterly. 2.4.1 draw a timeline for Mr Seboko's investments showing all

Ask by Hammond Harper. in South Africa
Mar 11,2025

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**Timeline:** - **Year 0:** - Deposits \( R80\,000 \) at \( 10.5\% \) annual interest. - **Year 3:** - Withdraws \( R15\,000 \) from the account. - **6 Months After Year 3 (Year 3.5):** - Adds \( R10\,000 \) to the account. - Interest rate changes to \( 17\% \) compounded quarterly. - **Year 5:** - Uses the funds for his trip overseas.

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To plot Mr. Seboko's investment journey, imagine a timeline that spans five years: **Year 0**: Mr. Seboko starts with R80,000. **Year 1**: R80,000 grows with 10.5% interest, resulting in approximately R88,400. **Year 2**: The investment continues to grow, reaching around R97,622. **Year 3**: By the end of the third year, the balance is about R107,185. Mr. Seboko withdraws R15,000, leaving R92,185. **Year 3.5**: Six months later, he deposits R10,000, bringing the total to R102,185. **Year 4**: Now earning 17% interest compounded quarterly, the account grows significantly, reaching over R121,000. **Year 5**: By the end of year five, Mr. Seboko's account amount has increased even more, allowing for a comfortable trip. This clear visual layout helps Mr. Seboko track his investment adjustments and gather insights for future financial plans! If you're curious about how compound interest really works, it’s all about the magic of earning interest on interest! The earlier you can invest, the more time your money has to grow exponentially. Also, when facing unforeseen circumstances, like Mr. Seboko's financial hiccup, it’s always a good idea to carefully assess your investment strategy – sometimes a temporary setback can lead to a better financial strategy in the long run!

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