Professional Documents
Culture Documents
Objectives
The aims of carrying out this project work are :
-To apply and adapt a variety of problem-solving strategies to solve
problems.
-To improve thinking skills.
-To promote effective mathematical communication.
-To develop mathematical knowledge through problem solving in a
way that increases students interest and confidence.
-To use the language of mathematical to express mathematical ideas
precisely.
-To provide learning environment that stimulates and enchances
effective learning.
-To develop positive attitudes towards mathematics.
Intoduction
1.General Definition of a Personal Loan
The major characteristics of personal loan is a debt incurred by
an individual consumer rather than a business loan or line of credit
granted to a company or corporation. Mortages are usually the
largest debt that individuals incur in a lifetime although some
educational loans are also quite large. Automobile loans are another
common type of personal loans. Personal loans can be obtained from
banks or finalce companies.
Traditional Versus Subprime Mortages
Traditional mortages are based on a conservative
percentage of a customers income and require substantial
down payment and a good to excellent credit rating.
Payments are based on principle and interest, with
payments toward the principal building equity for the
homeowner.
Subprime mortages typically carry higher interest rates,
which reflect the less favourable credit pfofiles of many but
not all of the consumer who use them to purchase their
homes. Such increases, coupled with a lack of equity against
which strapped homeowners could otherwise borrow
against, often lead to foreclosure and repossession of the
house.
Part 2
Bank
Total loan
Interest rate
Monthly
payment
Years/months
of loan
ocbc
Rm100,00
0
0.7%mont
h
7.1%year
Rm1709
10years
Cimb abs
maybank
Rm200.000
Rm100.000
1.6%years
6.5%years
Rm1068
Rm1930.56
30years
6years
Part 1 :
(B)1. Interest Rate
The interest rate is the percent charged, or paid, for the use of
money. It is charged when the money is being borrowed and paid
when it is being loaned. The interest rate that the lender charges is a
percent of the total amount loaned. Similarly, the interest rate that
an institution such as a bank pays to hold your money is a percent of
the total amount deposited. Banks then use that money to make
loans. Bank charge borrowers a little higher interest rate that they
pay depositors for that same money so they can get pfofit for
providing these services. Banks want to charge as much interest as
possible on loans, and pay as little as possible on deposits so they can
be more profitable. At the same time, banks are competing with each
other for those same deposits and loans. This competition keeps
interest rates in a similar range.
How Do Interest Rates Work ?
Interest rates are charged not only for loans, but also for mortages,
credit cards and unpaid bills. The interest rate is applied to the total
unpaid portion of your loan or bill. If your interest rate adds more
to your debt than the amount you are paying, your debt actually
increase eventhough you are making payments. Although interest
rates are very competitive, they arent the same. Some types of loans
like credit cards are always assigned higher interest rates because
they are more expensive to manage. Banks also charge higher rates
to people they consider riskier, The higher you score, the lower the
interest you will have to pay.
How it works/Example :
The formula to find an interest rate of loan isInterest Rate=(Total Repayment Amount-Amount Borrowed)
Lets assume ABC Company is considering building a new $60
million factory. If a bank agrees to lend ABC the $60 million dollars
but requires ABC to pay back $65 million at the end of the year, we
can calculate that ABC will pay back $65 million repaid $65 million
principal to borrow the money. This translates to: 0 million)
Interest Rate= ($6 million) / ($6 = 10% interest
Interest is often compounded, meaning that the interest earned on a
savings account for example, is considered part of the principal
after a predetermined period of time. Interest is then earned on the
larger principal balance during the next period and compounded,
the more interest is earned (or paid) on an investment.
Why it Matters:
Interest rates are one of the economys single strongest influences.
They facilitate the formation of capital and have a profound effect
on everything from individual investment decisions to job creation,
monetary policy and corporate profits.
In a free market economy, the laws of supply and demand generally
set interest rates. The demand for borrowing is inversely related to
Further Exploration
Years of loan= 20
Interest rate= 1.65%
Total loan = 200 000 + ( 1.65% x 200 000 x 20)
= 266 000
Monthly payment= 266 000 (12x 20)
= RM 1108.33
Years of loan = 15
Interest rate= 1.65%
Total loan= 200 000 + (1.65% x 200 000 x 15)
= 249 500
Monthly payment = 249 500 (12 x 15)
= RM 1386.11
Total save = 266 000 249 500
= RM 16 500
REFLECTION
While I was conducting this project, there was a lot of information
that I have found. This project encourages the student to work
together and share their knowledge, It also encourages student to
gather information from the internet, improve thinking skills and
promote effective mathematical communication. Not only that, I had
learned some moral values that I can practice. This project had
taught me to be responsible on the works that are given to me ato be
completed. This project also had made me felt more confidence to do
works and not to give easily when we could not find the solution for
the question. I also learned to be more discipline on time, which I
was given 3 weeks to complete this project and hand in to my
teacher just in time. I also enjoy doing this project as I need to spend
my time with friends to complete this project and it had tightens our
friendship.
CONTENT
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TITLE
ACKNOWLEDGEMENT
OBJECTIVES
INTRODUCTION
PART 1 (A)
PART 1(B)
PART 2
PART 3
FURTHER EXPLORATION
CONCLUSION
REFLECTION
REFERENCE
PAGES
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2
3-5
6
7-10
11-12
13
14-15
16-17
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