• Want to take part in this year's BoS Trials event for Maths and/or Business Studies?
    Click here for details and register now!
  • YOU can help the next generation of students in the community!
    Share your trial papers and notes on our Notes & Resources page

Question to Solve: (1 Viewer)

annababe

New Member
Joined
Sep 14, 2012
Messages
2
Gender
Undisclosed
HSC
N/A
Hi Guys,

Just wondering how would you all solve this question:

Jo deposits $100 each month in her account for 10 years. How much does she accrue if the bank
pays 7% interest compounded on a half-yearly basis?


Everyone seems to have different answers and working out (especially $17463).

Thank you!
 

legallaura

New Member
Joined
Jul 28, 2011
Messages
24
Location
Sydney
Gender
Female
HSC
2012
i would use a graphics calculator... i don't know if u have one, but get one if you can.
they are magic for questions like this once you know how to use them!!!

otherwise, use the formula for 'future value of an annuity'.
this formula is on the formulae sheet they give you in HSC Gen Maths

A = what you want to find out
M = $100 (payment per month)
r = 3.5% (7% pa / 2 to get half-yearly)
n = 10 x 2 or 20 time periods

so try entering this in your calculator
A = 100 (((1+0.035)^20)-1)/0.035


umm does that help??? sorry i think my maths knowledge has already fuzzed since doing the exam last Tuesday!!!
 

annababe

New Member
Joined
Sep 14, 2012
Messages
2
Gender
Undisclosed
HSC
N/A
Thanks for that :) however I'm still not 100% sure about the value of n. As the deposit is made monthly, should it be equal to 120?
 

Users Who Are Viewing This Thread (Users: 0, Guests: 1)

Top