Annuity question (1 Viewer)

[Microsoft Word]

I put the values into the future value formula: 1000(1+3.75%/12)^15 = $1047.91

But the answer is A

Could anyone help, please?

 

[BLIT2014]

What year was that question from?

 

[Microsoft Word]

what year was that question from?

2013 hsc

 

[BLIT2014]

2013 hsc

I = P*r*n
=$1000 * (3.75%/12) *
=$46.875

A=P+I
=$1000 + $46.875
=$1046.875
≈$1046.88

 

[BLIT2014]

You use the simple interest rate formula (interest rate is flat), rather than the future value formula.

 

[Microsoft Word]

Thank you so much

 

[Robbie M]

Yeah so the key word there is FLAT RATE, not compounded monthly etc

 

[D0gswag]

u dont use the formula