Two online papers in the same session: Paper A typed in Word and Paper B built in Excel, weighted 70:30.
Paper A
3 hours 20 minutes, answers typed in Word
Paper B
1 hour 50 minutes, answers built in Excel
Final mark
70% Paper A and 30% Paper B, both sat in the same session
What each paper asks
Paper A: questions of varying marks with full working, including short explanations and comments.
Paper B: questions answered in a spreadsheet, using everyday functions such as SUMPRODUCT, IF and VLOOKUP and Goal Seek.
About 5% of marks test knowledge, 80% application and 15% higher-order skills.
Try a question
Discount and interest on a promissory note
Paper A style · Interest rates · Straightforward · 6 marks
A finance company buys a promissory note that will pay £25,000 in exactly one year. It pays £23,850 for the note today.
(i)
Calculate the effective annual rate of discount earned by the company, as a percentage to 4 decimal places.
1 mark
(ii)
Calculate the effective annual rate of interest earned, as a percentage to 4 decimal places.
1 mark
(iii)
Explain by general reasoning why d=iv, where v=1/(1+i), and verify that your answers to (i) and (ii) satisfy this relationship.
2 marks
(iv)
The company's alternative is to lend at an effective rate of interest of 4.9% a year. Calculate the maximum price it should pay for the note, to the nearest penny, and comment on whether the purchase at £23,850 is attractive.