Currently, Sally has $100,000 and her investment horizon is 8 years (i.e., all investments will be terminated at the end of year 8). She is considering one of the following investments products being offered by her private banker from OCBC Bank: • Greentech Fund: First year return is 4% per year, and this will increase by 1% each year for the next four years. Thereafter, returns will remain constant. • Net-zero Fund: Investment can only be made two years later (i.e., Her money is in the bank for the first 2 years). When the investment is made, the return on the first three years is 6% per year and 12% per year thereafter. Interest of 3% per year (compounded monthly) can be earned if Sally deposits her money in an OCBC savings account. Analyze which is a better investment product. You are required to show all relevant workings. (b) SingLife is offering an endowment policy where Sally, aged 40 today, will need to make the following payments: • 41st birthday = $2,000 • 42nd birthday = $2,500 • 43rd birthday = $3,500 • 44th birthday = $5,000 In addition to the above, a final payment of $8,000 need to be made on her 60th birthday. When Sally reaches retirement age i.e. 63 years old, she will receive $60,000. Indicate and explain whether Sally should purchase this endowment policy assuming the relevant interest rate is 7%

Currently, Sally has $100,000 and her investment horizon is 8 years (i.e., all investments will be terminated at the end of year 8). She is considering one of the following investments products being offered by her private banker from OCBC Bank:
• Greentech Fund: First year return is 4% per year, and this will increase by 1% each year for the next four years. Thereafter, returns will remain constant.
• Net-zero Fund: Investment can only be made two years later (i.e., Her money is in the bank for the first 2 years). When the investment is made, the return on the first three years is 6% per year and 12% per year thereafter.
Interest of 3% per year (compounded monthly) can be earned if Sally deposits her money in an OCBC savings account.
Analyze which is a better investment product. You are required to show all relevant workings.

(b) SingLife is offering an endowment policy where Sally, aged 40 today, will need to make the following payments:
• 41st birthday = $2,000
• 42nd birthday = $2,500
• 43rd birthday = $3,500
• 44th birthday = $5,000
In addition to the above, a final payment of $8,000 need to be made on her 60th birthday. When Sally reaches retirement age i.e. 63 years old, she will receive $60,000.
Indicate and explain whether Sally should purchase this endowment policy assuming the relevant interest rate is 7%.