CHARTERED ACCOUNTANTS EXAMINATIONS

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TECHNICIAN LEVEL
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T3: MATHEMATICS AND STATISTICS

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WEDNESDAY 17TH DECEMBER 2014

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TOTAL MARKS 100; TIME ALLOWED: THREE (3) HOURS

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INSTRUCTIONS TO CANDIDATES

1. You have fifteen (15) minutes reading time. Use it to study the examination paper
carefully so that you understand what to do in each question. You will be told when to
start writing.

2. This paper is divided into TWO sections:

Section A: Ten (10) Multiple Choice Compulsory Questions.
Section B: Five (5) Optional questions. Attempt any four (4) questions.

3. Enter your student number and your National Registration Card number on the front of
the answer booklet. Your name must NOT appear anywhere on your answer booklet.

4. Do NOT write in pencil (except for graphs and diagrams).

5. The marks shown against the requirement(s) for each question should be taken as an
indication of the expected length and depth of the answer.

6. All workings must be done in the answer booklet.

7. Formulae are provided in a separate booklet.

8. Graph paper (if required) is provided at the end of the answer booklet.

SECTION A
Attempt all TEN sub- questions in this section

QUESTION ONE - MULTIPLE CHOICE QUESTIONS

Each of the following questions has only one correct answer. Write the letter of the correct
answer you have chosen in your answer booklet. Marks are indicated against each question.
x x
1.1 Simplify 27 3 9 2

A. 3
B. 0
C. 1
D. 5 (2 marks)

1.2 What sum of money when increased by 9% equals K45.68?

A. K45.70
B. K41.91
C. K50.20
D. K54.68 (2 marks)

1.3 If Mr. Banda received a discount of K435 from a trade discount of 42%, what was the
gross price of the item?

A. K1,035.11
B. K6,177.00
C. K750.00
D. K1,035.71 (2 marks)

Solve the quadratic equation 4 x 7 7 73 giving your answer correct to 2 decimal

2
1.4
places.

A. x 0 or x 23.53
B. x 9.12 or x 5.50
C. x 8.12 or x 3.51
D. x 11.47 or x 2.53 (2 marks)

1.5 A house costs K250, 000. After a down payment of K70, 000, the balance will be paid off
in 48 equal monthly payments with interest of 6% per year on the unpaid balance. Find
the amount of each payment.

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 A. K5,871.26
B. K3, 293.43
C. K4, 227.31
D. K6, 257.30 (2 marks)

1.6 The summary statistics of the data for two variables sales P and Q are shown below:

P 510, P 2
34140, Q 624, Q2 45056, PQ 37884 and n 9

Calculate Pearsons correlation coefficient, r .

A. 0.8237
B. 0.9138
C. 0.6419
D. 0.7731 (2 marks)

1.7 Solve the equation (3x 4)(x + 1) = - 2

A. 0, 2
2
B. 1,
3
C. 3, 1
1 2
D. , (2 marks)
3 3

1.8 Mr. Mushoki is a manager of an exclusive shop that sells mens suits and accessories.
From past experience, he knows that demand for the suits in peak fashion season
has the following probability distribution

Number of suits 8 10 12 14 16

Probability 0.10 0.20 0.25 0.30 0.15

Find the expected number of suits he is likely to sell within a given season.

A. 60
B. 15.8
C. 30
D. 12.4 (2 marks)
1.9 Insurance reports show that the business section in a particular business section
in a particular town report on average two thefts attempts per month. What is

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 the probability that at least two theft attempts are reported during the next
month?

A. 0.1353
B. 0.4060
C. 0.2707
D. 0.5940 (2 marks)

1
1.10 Simplify log 3
9
A. -2
B. 2
C. 3
D. 27 (2 marks)

SECTION B

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Attempt any FOUR (4) questions in this section.

QUESTION TWO

(a) A box contains 5 black balls and 7 white balls. If 2 balls are drawn at random in
succession, without being replaced, what is the probability that:

(i) Both the 2 balls are black? (2 marks)

(ii) Exactly 1 ball is white? (2 marks)
(iii) At least 1 ball is white? (3 marks)

(b) Given the following data set:

x -3 -1 1 1 2
y 6 4 3 1 1

(i) Plot the scatter diagram, and indicate whether x and y appear linearly related.
(3 marks)

(ii) Find the regression equation for the data. (7 marks)

(iii) Find the correlation coefficient r (3 marks)

[Total: 20 marks]

QUESTION THREE

(a) You are working for the Transport Manager of a large chain of supermarkets which hires
cars for the use of its staff. Your boss is interested in the weekly distances covered by
these cars. Mileages recorded for a sample of hired vehicles from fleet 1 during a given
week yielded the following data:

98 87 72 82 102
60 94 92 76 71

68 79 75 69 89
84 86 85 73 75

Calculate:

(i) The mean mileage (2 marks)

(ii) The median mileage (2 marks)
(iii) The first quartile (2 marks)
(iv) The third quartile (2 marks)
(v) The variance (4 marks)

(b) (i)
Simplify 2 x 2 y 3xy 3 and find the value of the expression when x2

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 and y 3 . (4 marks)

(ii) The second term of a geometric series is 30 and the sum of the first two terms
is 15. Find the first term and the common ratio. (4 marks)
[Total: 20 marks]

QUESTION FOUR

(a) The following data represents the number of students registered for the course
Mathematics and Statistics under various ZICA centres.

Name of centre Number of students

Livingstone 10
NIPA 25
ZCAS 35
Kitwe 30

(i) Draw the pie chart for the given data (6 marks)
(ii) Draw the bar chart for the given data (5 marks)

(b) The daily sales at a restaurant has a probability distribution that is approximately normal
with mean equal to K92,750 per day and standard deviation equal to K21,000.

(i) What is the probability that the sales will exceed K122,500 on a given day?
(4 marks)

(ii) What is the probability that the sales will be less than K137,750?
(5 marks)
[Total: 20 marks]

QUESTION FIVE

(a) Kafwanka borrows K1, 500 from a bank that charges 10% annual simple interest rate.
He plans to make weekly payments for two years to repay the loan.

(i) Find the total interest paid for this loan (2 marks)

(ii) Find the total amount to be paid back (2 marks)

(iii) Find the weekly installment (2 marks)

(b) Find the amount after 5 years when K2, 750 is invested at 5% compounded

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 (i) Semi annually (2 marks)
(ii) monthly (2 marks)
(iii) continuously (2 marks)

(c) What is the present value of an annuity immediate that pays K4, 000 every six months
for 3 years if money is worth 6% compounded semi annually? (4 marks)

(d) Find the future value of an annuity due if payments of K500 are made at the beginning
of each quarter for 7 years, in an account paying 6% compounded quarterly.
(4 marks)
[Total: 20 marks]
QUESTION SIX

(a) A company buys four products with the following characteristics:

Items Number of units bought Price paid per unit (K)

Year 1 Year 2 Year 1 Year 2
A 20 24 10 11

B 55 51 23 25

C 63 84 17 17

D 28 34 19 20

(i) Find the simple price indexes for the products for year 2 using year 1 as the base
year. (4 marks)

(ii) Find the simple aggregate index for year 2 using year 1 as the base year.
(4 marks)
(iii) Find Laspeyres index, for year 2 using year 1 as the base year. (5 marks)

(iv) Find the Paasche index, for year 2 using year 1 as the base year. (5 marks)

(b) Solve the equation 4 x 3 - 2 = 0. (2 marks)

[Total: 20 marks]

END OF PAPER

T3 SUGGESTED SOLUTIONS

7
QUESTION ONE

x x x x
3 2
1.1 27 9 3 3
3 2 3 2

3x 3x
3x x
30
1
The correct answer is C
1.2 New =K45.68
Percentage change =+9% (increased)
=+0.09
Old x

45.68 45.68
Old= K 41.91
1 percentage change 1 0.09 1.09
The correct answer is B

1.3 Discount= K435

Discount Percentage = 42% = 0.42
Gross price = unknown

435
Gross price = Discount Percentage
= K1035.11
0.42
The correct answer is A
1.4 4 x 7 7 73
2

4 x 7 73 7
2

4 x 7 80
2

x 7 20
2

x 7 4.47
x 7 4.47
x 7 4.47 or x 7 4.47
x 11.47 or x 2.53
The correct answer is D

8
1.5 Interest will be charged for the loan of K180, 000. We are given P=K180, 000,
0.06
r 0.005, and n 48 . We are asked to find R(periodic payment). We have
12
r
R P n
1 1 r
0.005
180000 48
1 1.005
K 4, 227.31
The correct answer is C

n PQ P Q
1.6 r
n P 2 P 2 n Q 2 Q 2

9 37884 510 624
r
9 34140 510 2 9 45056 624 2

22, 716
r
307, 260 260,100 405,504 389,376
22, 716
r
47,160 16,128
0.8237
The correct answer is A

1.7 3x2 + 3x 4x 1 = - 2
3x2 x 2 = 0
(3x + 2)(x 1) = 0
2
Therefore, x = or x = 1
3
The correct answer is B

1.8 E X xP X x
x

8 0.10 10 0.20 12 0.25 14 0.30 16 0.15

12.4
The correct answer is D

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1.9 2
Pr (at least 2) = 1 [Pr(0) + Pr(1)

2 0 2
Pr(0) = e 0.1353
0!

21 2
Pr(1) = e 0.2707
1!
= 1 (0.1353 + 0.2707) = 1 0.4060 = 0.5940

The correct answer is D

1
1.10 log3 log3 32 2log3 3 2
9
Note: log3 3 1
The correct answer is A.

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QUESTION TWO

4 20
(a) B
11 132

5 7
B W
12 11

5
W B
11
7
12
6
W
11

5 4 20 10 5
(i) P( B B) X 0.1515
12 11 132 66 33
5 7 7 5 35 35 70
(ii) P ( B W ) P ( B ) x x 0.5303
12 11 12 4 132 132 132

5 7 7 5 7 6
(iii) 11 + 12 11 + 12 11
12

= 0.8485

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 (b)

7 Y

0
-4 -3 -2 -1 0 1 2 3

There is a linear relationship between x and y because the points are

close to each other.

(i) y 0 1 x

x y x2 xy y2

-3 6 9 -18 36
-1 4 1 -4 16
1 3 1 3 9
1 1 1 1 1
2 1 4 2 1

0 15 16 -16 63

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 x
x 0 0; y
y 15 3
n 5 n 5
x
2
02
SS xx x 2
16 16
n 5

SS xy xy
x y 16 015 16
n 5
y 15
2 2

SS yy y 2
63 18
n 5
SS xy 16
1 1
SS xx 16
0 y 1 x 3 1 0 3
Therefore, the regression equation for the data is y 3 x

(ii) The correlation coefficient is given by

SS xy 16
r 0.9428
SS xx SS yy 16 18

QUESTION THREE

(a)

(i) x
x 1617 80.85
n 20

(ii) We arrange the mileages in ascending order

60, 68, 69, 71, 72, 73, 75, 75, 76, 79, 82, 84, 86, 87, 89, 92, 94, 98,
102
79 82
Median 80.5
2

1
(iii) Q1 20 1 value 5.25
th

4
73 72 1 5.25 5 1 0.25 0.25 72 72.25

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 3
(iv) Q3 20 1 15.75
4
89 87 2 15.75 15 2 0.75 1.5 87 88.5

x 1617
2 2

x 2

n
133, 005
20
(v) S2 119.5
n 1 19

(b)
(i) 2x y 3xy 2 3 x
2 3 2
x1 y1 y 3
6x 1 y 2
6

xy 2
When x 2 and y 3 , we have
6 6 6 1

xy 2
2 3 18 3
2

(ii) a = first term, r = common ratio

a, ar, ar2, ar3,

ar = - 30 (1)
a + ar = - 15 (2)
Solving (1) and (2) simultaneously gives
a + (- 30) = - 15
a 30 = - 15
a = - 15 + 30 = 15
15r 30
Using (1), , giving r = - 2
15 15
r n 1
Sum of the geometric series S n a
r 1
n = 10, r = (1 + 0.08) = 1.08, a = 3,500

1.0810 1
S10 K 50,702.97
1.08 1

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QUESTION FOUR

(a)
10
(i) Livingstone: 360 36
100
25
NIPA: 360 90
100
35
ZCAS: 360 126
100
30
Kitwe: 360 108
100
Pie-Chart for students taking Mathematics and Statistics

ZCAS, 126

KITWE, 108

NIPA, 90

LIVINGSTONE,
36

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 (ii) Bar-Chart for students taking Mathematics and Statistics
40
35

NUMBER OF STUDENTS
30
25
20
15
10
5
0
LIVINGSTONE NIPA ZCAS KITWE
CENTRE

(b)
122500 92750
(i) Prx 122,500 P( Z
21000
PrZ 1.42 0.5 0.4222 0.0778

137750 92750
(ii) PrZ 137750 2.14
21000
Pr = 0.4838
Therefore, 0.5 + 0.4838 = 0.9838

QUESTION FIVE

(a)
(i) The total interest paid is
I Pr t 1500 0.10 2 K 300

(ii) The total amount to be paid back is

A t P Pr t
A 2 1500 300
K1,800

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 (iii) The weekly installment is
1800
K17.31
2 52

(b)
(i) For interest compounded semi- annually, we have n 2 . Thus,
nt
r
A t P 1
t
2 5
0.05
A 5 2750 1 K 3,520.23
2

(ii) For interest compounded monthly, we have n 12 . Thus,

nt
r
A t P 1
n
12 5
0.05
A 5 2750 1
2
K12, 099.42

(iii) For interest compounded continuously we have

A t Pert 0.05 5
A 5 2750e0.055
K 3,531.07

0.06
(c) We are given R K 4000, r 0.03 and n 3 2 6 . We are asked to find
2
P . We have
1 1 r n
P R
r
1 1 0.03 6
4000
0.03
1 1.036
4000
0.03
K 21,668.77

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 (d) In 7 years, there are n 28 quarterly periods
1 r n 1 1 0.06
FV R 1 , r 0.015
r 4

1.015 29 1
500 1
0.015
K17, 499.35

QUESTION SIX

(a)
11
(i) Product A: 100 110.0
10
25
Product B: 100 108.7
23
17
Product C: 100 100.0
17
20
Product D: 100 105.3
19

NOTE: All these figures come from the prices only and no weighing has been
applied.

sum of prices in Year 2 11 25 17 20 73

(ii) 100 105.8
sum of prices in base year 10 23 17 19 69

sum of prices weights in Year 2

(iii) Index for year 2 = sum of prices weights in base year

11 20 25 55 17 63 20 28

10 20 23 55 17 63 19 28
3226
100
3068
105.15

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 sum of prices weights in Year 2
(iv) Index for year 2= sum of prices weights in base year

11 24 25 51 17 84 20 34

10 24 23 51 17 84 19 34
3647
100
3847
94.80
(b)

4 x 3 2 0 or 4 x 3 2
Squaring both sides gives 4x + 3 = 4 or 4x = 4-3
1
Therefore, x =
4

END OF SUGGESTED SOLUTIONS

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