Q1

Amount of housing loan

Rate of Interest
Tenure
EMI
Rental outgo p.m.
Existing SIP in Equity Fund
Existing SIP in Bananced Fund
Present Outflow
Excess of EMI over rental

Proportionate reduction in Equity SIP

Proportionate reduction in Balanced SIP
Future Outflow in SIP
Future Total Outflow

Ans: (A)

Q2

Interest
Compounding

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
 23
24
25
26

Q3

Amount shifted to Debt Scheme

Balance in Equity Scheme (32.45 - 15.00)
Amount required in the first month of retirement
Corpus to be accumulated to sustain 25 years
Rate of return in Debt Schemes (7% p.a.)
Rate of return in Equity Schemes (11% p.a.)
Accumulation of current PV in Debt scheme in 21 years
Accumulation of current PV in Equity scheme in 21 years
Balance to be accumulated through SIPs
Let the investment be of Rs. 60 in Debt and Rs. 40 in Equity schemes
Fresh accumulation in Debt schemes in 21 years
Fresh accumulation in Equity schemes in 21 years
Total fresh accumulations through SIP
Thus Rs. 100 invested through SIPs is equivalent to
Investment in Debt MF
Investment in Equity MF

Q4

The rate to be targeted ( R )

Fund Management expenses applied over the year ( e )
The Gross return R per annum to be produced by the fund to return a rate of r p.a.

Q5

Dates Dividends NAV

 2-May-04 -300000 12.58
18-Aug-04 28616.85 12.95
20-Nov-05 28616.85 13.05
15-Apr-07 28616.85 13.99
16-Jun-08 28616.85 14.68
2-Apr-10 397774.2 16.68
Rate of Return

Q6

PPF balance as on March 31, 2010

Amount invested every year
Balance
1 1-Apr-10 729000
2 1-Apr-11 857320
3 1-Apr-12 995906
4 1-Apr-13 1145578
5 1-Apr-14 1307224
6 1-Apr-15 1481802
7 1-Apr-16 1670346
8 1-Apr-17 1873974
9 1-Apr-18 2093892
10 1-Apr-19 2331403
11 1-Apr-20 2587916
12 1-Apr-21 2794949

Amount required for the world tour after 11 years

Amount utilized half of PPF maturity proceeds as extended
Shortfall in amount required

Q7

Present age 12 years

Marriage at age 24 years
Present cost 1500000
Cost then $2,851,811
Equity 11%
Debt 7%

ASSUMPTIONS

Suppose she invests Rs. 100 p.m.

Till the age of 19 years
Debt 30
Equity 70

Debt accumulation till age 19

Equity accumulation till age 19
Debt accumulation till age 24
Equity accumulation till age 24
Total

Till the age of 24 years

Debt 60
Equity 40

Debt accumulation after age 19 till age 24

Equity accumulation after age 19 till age 24
Total

Total accumulation at the age of 24

If by investing Rs. 100 she gets Rs. 26654, so to get Rs. 2851811 she needs to invest

The amount required for both of her children's marriage

 INR

6000000
10%
180 months
$64,476
50000
25000
15000
90000
$14,476

9048
5429
14476
$90,000

8% p.a.
6 months

-50000
-50000
-50000
-50000
-50000
-50000
-130,000
-130,000
-130,000
-130,000
-130,000
-130,000
-258,100.00
-258,100.00
-258,100.00
-258,100.00
-258,100.00
-258,100.00
-463,200.00
-463,200.00
-413,226.42
-413,226.42
 -413,226.42
-413,226.42
-741,598.12
-741,598.12
569,774
540,070
511,915
485,227
825,417
782,386
3,714,788 Total value at the time of retirement

1500000
1745000
384,779
92,194,247
0.0056541454 p.m.
0.0087345938 p.m.
6,210,844
15,616,294
70,367,109

33,515
36,721
70,236
100186
60112
40075

11% p.a.
2.25% p.a.
1.134975
-1
0.134975

Units Purchased
 23847.377

13%

659000
70000
Interest Total
58320 787320
68586 925905.6
79672 1075578
91646 1237224
104578 1411802
118544 1600346
133628 1803974
149918 2023892
167511 2261403
186512 2517916
207033 2794949

$1,441,674
1397475
$44,199

p.a. 0.008735 p.m.

p.a. 0.005654 p.m.
 $3,232.35
$8,699.80
$4,533.54
$14,659.66
$19,193.21

$4,295.90
$3,164.62
$7,460.53

$26,653.73

10699

21399