Question three

a) In a certain population, the annual birth and death rates per 1000 are 39.4 and 19.4 respectively. Find the number of years in which the population will be doubled.

(5 marks )

b) A machine is depreciated in such a way that the value of the machine at the end of any year is 90% of its value at the beginning of the year. The cost of the machine was $12,000 and it was sold eventually as waste metal for $200. Find the number of years

during which the machine was in use. (5 marks )

c) A house sells for $50,000 down and 10 semi-annual payments of $5,000 each, the first due 3 years hence. Find the cash price of the house, if money is worth 6% p. a.

compounded semi-annually. (5 marks )

d) Comprehensive Book publishers Limited are planning to produce a new text book in life skills. The fixed costs are Sh. 3,300,000 and the variable costs are Sh. 312.50 per textbook. The wholesale price will be Sh. 437.50 per textbook. How many textbooks must Comprehensive Book Publishers publish and sell in order to break-even?

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