SMK AGAMA SHARIFAH RODZIAH

TELOK MAS , 75460 MELAKA

ADDITIONAL MATHEMATICS

PROJECT 1//2012

NAME

I/C NO

CLASS

TEACHER'S NAME

SITI NADHIRAH BINTI HISHAMUDDIN

5 IBNU SINA

MISS ONG SIEW CHOE

CONTENT

NO CONTENT PAGE

1 Acknowledgement

2 Objectives

3 Introduction

4 Part 1

5 Part 2

6 Part 3

7 Futher Exploration

8 Conclusion

9 Reflection

10 Attachment

11 Reference

Acknowledgment

After weeks of struggle and hard work to complete assignment given to us by our teacher , Miss

Ong Siew Choe , I finally did it within two weeks with satisfaction and senses of success because

I have understood more deeply about the interest and investment more than before . I have to be

grateful and thankful to all parties who has helped me in the process of completing assignment .

It was a great experience for me as I have learnt to be more independent and to work as group .

For this , I would like to take this opportunity to express my thankfulness once again to all

parties concerned .

Firstly , I would like to thank my additional mathematics’ teacher , Miss Ong Siew Choe for

patiently explain to us the proper and precise way to complete this assignment . With his help

and guidance , many problems I encountered have been solved .

Besides that , I would like to thank my parents for all their support and encouragement which has

given to me . In addition , my parents had given guidance on the methods to account for

investment which have greatly enchanced my knowledge on particular area .

Last but not least , I would like to express my thankfulness to my cousin and friends who have

patiently explained to me and did this project with me in groups.

Objectives

i. To apply and adapt a variety of problem-solving strategies to solve problems

ii. To improve thinking skills

iii. To promote effective mathematical communication

iv. To develop mathematical knowledge through problem solving in a way that increases

students’ interest and confidence

v. To use the language of mathematics to express mathematical ideas precisely

vi. To provide learning environment that stimulates and enhances effective learning

vii. To develop positive attitude towards mathematics

Introduction

In finance unsecured debt refers to any type of debt  or general obligation that is not

collateralized by a lien on specific assets of the borrower in the case of a bankruptcy or

liquidation or failure to meet the terms for repayment .

In the event of the bankruptcy of the borrower , the unsecured creditors will have a general claim

on the assets of the borrower after the specific pledged assets have been assigned to the secured

creditors , although the unsecured creditors will usually realize a smaller proportion of their

claims than the secured creditors .

In some legal systems , unsecured creditors who are also indebted to the insolvent debtor are able

( and in some jurisdictions , required ) to set - off  the debts , which actually puts the unsecured

creditor with a matured liability to the debtor in a pre-preferential position .

Also called signature loans or personal loans. These loans are often used by borrowers for small

purchases such as computers, home improvements, vacations or unexpected expenses.

An unsecured loan means the lender relies on the borrower's promise to pay it back. Due to the

increased risk involved, interest rates for unsecured loans tend to be higher. Typically, the

balance of the loan is distributed evenly across a fixed number of payments; penalties may be

assessed if the loan is paid off early. Unsecured loans are often more expensive and less flexible

than secured loans, but suitable if the lender wants a short-term loan (one to five years).

In the UK there are hundreds of different unsecured loans to choose from, so comparison tables

have become a popular way of finding out about the different options available. In 2006,

according to the Bank of England, 22% of UK households had some unsecured debt with a

further 21% having both secured and unsecured debt.

MELAKA EDUCATION DEPARTMENT

ADDITIONAL MATHEMATICS PROJECT WORK 1/2012

PART 1

Banks are always competing to give the best offer of loans to potential customers.

a) Get personal loan brochures from at least three banks in home town . You can even get

them from the internet . Construct a table of comparison between three brochures . Your

table should include :

Total loan

Interest rate

Monthly payment

Years/months of loan

b) Find the meaning of the following terms

i) Interest rate

ii) Monthly payment

(a) Table of comparison between the banks :

Public Islamic Bank CIMB Bank Bank Islam

Total Loan RM 100 000 RM 100 000 RM 100 000

Interest Rate 4.99 % 4.38 % 3.32 %

Monthly Payment RM 1250 RM 1205 RM 1110.21

Years / Months of

Loan

10 years / 120 months 10 years / 120 months 10 years / 120 months

(b) i. Meaning of Interest Rate

The rate charged or paid for using money. You are charged an interest rate when you borrow

money and paid an interest rate when you loan money ( placing it in a savings or investment

account is like a loan to the bank ) .With credit cards and loans , the interest rate directly

influences the cost of borrowing . Lower interest rates mean you'll pay a lower cost , while

higher interest rates mean a higher cost . You'll see the cost reflected in your finance charges .

Interest rate is typically influenced by your credit score . Low credit scores lead to high interest

rates and vise versa . Interest rates are typically expressed as an annual percentage rate -the

yearly cost ( or benefit ) of borrowing ( or loaning ) money .

ii. Meaning of Monthly Installment

A fixed payment amount made by a borrower to a lender at a specified date each calendar

month . Equated monthly installments are used to pay off both interest and principal each

month , so that over a specified number of years , the loan is paid off in full .

PART 2

1) Encik Ahmad plans to take a personal loan of RM 100,000 for a duration of 156 months .

As a friend of Encik Ahmad and by comparing the installment rates and the monthly

installments from the three brochures , which bank would you suggest Encik Ahmad get

his personal loan ? Give your reasons why .

As a friend of Encik Ahmad , I would suggest him to get his personal loan from Bank Islam

based on the table that I have constructed to show the comparison between the three banks that I

suggested to him to choose a personal loan if he plans to take a personal loan of RM 100000 for

a duration of 156 months ( 13 Years )

Public Islamic Bank CIMB Bank Bank Islam

Total Loan RM 100 000 RM 100 000 RM 100 000

Interest Rate 4.99 % 4.38 % 3.79 %

Monthly Payment RM 1057 RM 1011 RM 956.53

So , based on the table above absolutely I would suggest Bank Islam to Encik Ahmad .

This is because Bank Islam had the lowest installment rate that is 3.79 % . Besides that ,

Encik Ahmad also has to pay the monthly installments for the lowest payment among the

CIMB Bank and Public Islamic Bank that is RM 956.53 . So , Encik Ahmad does not

have to pay more payment as the money can be used for other expenses . So , that is why

I suggested Encik Ahmad to choose the Bank Islam to take a personal loan because Bank

Islam offered the best installment rate and the monthly payment among the other two

bank .

PART 3

1) Find the number of months that Encik Ahmad would take to have paid at least RM

40,000

Formula : Installment x Months = Monthly Installment

RM 956.53 x Months = RM 40000

Months = RM 40000 ÷ RM 956.53

= 42 months

So , the number of months that Encik Ahmad would take to have paid at least RM 40000

is at least 42 months .

FUTHER EXPLORATION

Calculate how much would Encik Ahmad save if he makes the loan repayment in 10 years .

With Bank Islam , it only takes 3.32% of interest for 10 years loan .

Thus, we can calculate the total amount needed to be paid .

Total amount = total loan + (interest x total loan x years of loan)

= 100,000 + (3.32% x 100,000 x 10)

= RM133,200

Monthly instalment = 133,200

120

= RM1,110

Total amount = 100,000 + (3.79% x 100,000 x 13)

= RM149,270

Monthly instalment = 149,270

156

= RM956

Based on the calculation, the total amount needed to be paid back is RM133,200 and the monthly

instalment is only RM1,110. If compared to the 13 years loan, the total amount that should be

paid back is RM149,270 and the monthly instalment is RM956.

By taking the loan for 10 years, Encik Ahmad would save RM16,070 which is a large amount of

money. Even though he has to pay a bit higher for the monthly instalment, it is still affordable.

Moreover, he only needs to pay back in 10 years and he can save more money.

Conclusion

If you need additional funds for any reason, a Commonwealth Bank personal loan can be

customised to suit your needs. You can borrow from $5,000 to $50,000 and pay it weekly,

fortnightly or monthly over a loan term from one year up to seven years. This can be a much

faster way to cover your costs than adding them to your home loan.

Our personal loans have lower interest rates and monthly fees than many credit cards, store cards

and other lending schemes so it can be a more cost-effective and manageable way to get the

things you want.

If you choose a fixed interest rate, you’ll know exactly how much you have to pay each month. If

you choose a variable rate, you’ll be able to make extra repayments at any time you have some

spare cash without incurring a fee and you can benefit from potential rate decreases. Because

your loan is unsecured, assets such as your home are not at risk.

Reflection

Apart from that , this project encourages the student to work together and share their knowledge.

It is also encourage student together information from the internet, improve thinking skills and

promote effective mathematical communication. Not only that , I had learned some moral values

that I practice. This project had taught me to responsible on the works that are given to me to be

completed. This project also had made me felt more confidence to do works and not to give up

easily when we could not find the solution for the question. I also learned to be more discipline

on time, which I was given about 3 weeks to complete this project and pass up to my teacher just

in time. I also enjoy doing this project and it had tighten our friendship . Last but not least, I

proposed this project should be continue because it brings a lot of moral value to the student and

also test the students understanding in Additional Mathematics .

REFERENCE

http://en.wikipedia.org/wiki/Interest_rate

http://www.investopedia.com/terms/i/interestrate.asp#axzz1wDzB4oN7

http://www.investorwords.com/2539/interest_rate.html

http://www.investopedia.com/terms/e/equated_monthly_installment.asp

Dictionary of Banking, G Klein

New Oxford English-English-Malay Dictionary, Oxford Fajar

Bank Islam

CIMB Bank

Public Islamic Bank