To calculate the net price at maturity, we use the formula for compound interest:
A = P(1 + r/n)^(nt)
Where:
A = the amount at maturity
P = the principal amount (R50,000)
r = the annual interest rate (10% or 0.10)
n = the number of times interest is compounded per year (assuming it's compounded annually, n = 1)
t = the number of years the money is invested for (3 years)
Plugging in the values:
A = 50000(1 + 0.10/1)^(1*3)
A = 50000(1.10)^3
A = 50000(1.331)
A = 66550
Therefore, the net price at maturity is R66 550 at the end of 3 years.
