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 ?
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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.....
please clarify the math......
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%....
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
but when you say c i amount of 12 years it already includes the 12th year interest also right?
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