a person invests Rs.500 at the end of each year with a bank which pays interest at 10% p.a.c.i annually.the amount standing to his credit one year after he has made his yearly investment for the 12th time is ?
intermediate(ipc)course (no) (1460 Points)
06 October 2011a person invests Rs.500 at the end of each year with a bank which pays interest at 10% p.a.c.i annually.the amount standing to his credit one year after he has made his yearly investment for the 12th time is ?
Swapnil Jain
(Finance - FP&A)
(564 Points)
Replied 06 October 2011
i think the answer to this is Rs 10680...though i m not too good at maths....
note- i have calculated interest and amount both upto 12th year and for the 13th year as u have asked one year after i have taken into account only the intreset amount.....
Swapnil Jain
(Finance - FP&A)
(564 Points)
Replied 06 October 2011
500*12+39000*12/100
500 is the principal for 12 years (i assumed that 13th year only intrest accrued and no princiapal was deposited)
39000 in the way that - for the first year no interest
2nd year - interest on500 @ 12 %
3 rd year- Intt on1000 @ 12%
and so on
Pardon me!! I took the interest @ 12%....
Daman Jeet
(AM)
(21 Points)
Replied 20 September 2012
Hadi Husain Husaini
(IDT Consultant)
(99 Points)
Replied 02 July 2013
The formula for Future Value of Annuity is : F.V = Annuity x ( ( ( 1 + (R.O.I) ) ^ T - 1) / R.O.I)
R.O.I is 10%
Annuity is 500
Time is 12 years
Therefore on substituting : F.V of Annuity would be = Rs. 10692.14
but interest for the year after the 12th investment will also have to be added which would come to 1069.214 @ 10% p.a
Therefore amount standing to his credit would be = Rs. 11761.36
Padmasandhya S
(Student)
(34 Points)
Replied 15 May 2015
but when you say c i amount of 12 years it already includes the 12th year interest also right?
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